Yahoo Finance Starbucks bucks the controversy
While all the buzz about Starbucks (SBUX) this week is about it’s “Race Together” campaign to discuss race relations in its coffee shops, the company is winning a different kind of race-- the race to the top on Wall Street.
Shares have been soaring…setting all-time highs. The latest driver is Starbucks’ announcement at its annual shareholders’ meeting that it is splitting its stock 2-for-1. And Yahoo Finance Senior Columnist Michael Santoli says that’s not all.
“You have a lot of other things to draw attention in addition to the stock split,” he points out. “You have people talking about delivery, you have a lot of other things going right for Starbucks.”
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Santoli feels by initiating the controversial “Race Together” campaign, CEO Howard Schultz is actually showing off how big Starbucks is.
“The fact that Howard Schultz felt sort of compelled use Starbucks as a forum was more just underscoring the fact that we’re ubiquitous, we’re everywhere, we get to set the agenda and this is where Americans, essentially, come to meet as a daily habit,” he says. “It kind of reinforces that idea that it’s right in the fabric of the country.”
However, Yahoo Finance’s Aaron Task wonders if investors may think using Starbucks as a forum for race discussions might be a bit too much.
“If you’re a shareholder, should Howard Schultz be focusing on that or focusing on getting the customer service better and making sure their new food offerings are the right food offerings,” he asks. “I’m sure he’s focusing on all these things, but it seems he may have gone kind of far afield.”
But Santoli notes that won’t be a problem if the stock keeps soaring.
“The shareholders are only going to care if they see those other things suffering at this expense,” he adds.
Still, Task questions whether “Race Together” is a smart move for Starbucks.
“Do I want my barista focusing on ‘Am I going to talk to this person about race’ or are they going to make the cappuccino that I want,” he asks. “I don’t think it’s good business, but the market doesn’t seem to care right now."
