Yahoo Finance Starbucks (SBUX) Expands U.S. Delivery With DoorDash Tie-up
Starbucks Corporation SBUX and DoorDash recently announced the rollout of a new delivery service in Northern California, Texas, Georgia and Florida.
The initiative follows on the heels of positive customer feedback with respect to market expansions in Seattle, Portland, and New York City. Also, the successful pilot in Atlanta, Houston and Sacramento added to the positives.
Concerning the launch, Brooke O’Berry, Starbucks senior vice president of digital experiences, stated, “As customer behaviors evolve, we continue to innovate the Starbucks Experience to connect with them through meaningful and valuable digital experiences. Our partnership with DoorDash allows us to provide our customers with another convenient way to enjoy Starbucks wherever they are.”
Given the logistics power and geographic scale of DoorDash, the company remains optimistic in this regard and anticipates store coverage in 50 states by March 2023.
Emphasis on Delivery & Digital Initiatives
Starbucks has continued to innovate the retail experience to connect with customers digitally. Given the changing consumer landscape, emphasis on initiatives including Starbucks Rewards, the Starbucks app, Mobile Order and Pay, bode well. These strategies align closely with rapidly evolving customer preferences, including higher levels of mobile ordering, more contactless pick-up experiences and reduced in-store congestion.
In January 2022, the company initiated its mobile order and delivery service — Starbucks Delivers — on Meituan platforms. Focused on customers in China, the expanded features include beverage customizations, smart technology that automatically reallocates orders to other stores when products are sold out and the delivery debut of Starbucks Reserve. The company stated that Starbucks Rewards members could enjoy the same benefits as the ones utilizing the Starbucks China app.
Going forward, the company intends to transform its store portfolio and elevate technology to enhance the customer experience and drive long-term growth.
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In the past three months, the company’s shares have gained 22% compared with the industry’s 12.3% growth.
Zacks Rank & Key Picks
Starbucks currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the Zacks Retail-Wholesale sector are Darden Restaurants, Inc. DRI, McDonald's Corporation MCD and Yum! Brands, Inc. YUM.
Darden carries a Zacks Rank #2 (Buy). DRI has a long-term earnings growth rate of 9.8%. Shares of DRI have gained 7.5% in the past year.
The Zacks Consensus Estimate for Darden’s 2023 sales and earnings per share (EPS) suggests growth of 7.9% and 5.5%, respectively, from the year-ago period’s reported levels.
McDonald's carries a Zacks Rank #2. MCD has a long-term earnings growth rate of 8.2%. Shares of MCD have gained 7.4% in the past year.
The Zacks Consensus Estimate for McDonald's 2023 sales and EPS suggests growth of 3.2% and 5.3%, respectively, from the year-ago period’s reported levels.
Yum! Brands currently carries a Zacks Rank #2. YUM has a long-term earnings growth rate of 11.8%. Shares of YUM have gained 4.7% in the past year.
The Zacks Consensus Estimate for Yum! Brands’ 2023 sales and EPS suggests growth of 6.2% and 15.5%, respectively, from the year-ago period’s reported levels.
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Starbucks Corporation (SBUX) : Free Stock Analysis Report
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