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Will Starbucks (SBUX) Stock Price Keep Rising Under New CEO?

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Updated 2 Sep 2022

Key points:

  • The Starbucks stock price has risen 8.1% in the past three months.
  • Will SBUX stock keep rising after the new CEO takes over?
  • Will Starbucks’ new CEO, Laxman Narasimhan deliver?

The Starbucks Corporation (NASDAQ: SBUX) stock price has risen 8.1% in the past three months after bottoming on June 16, 2022. The multinational chain of coffeehouses and roastery reserves just announced the appointment of Laxman Narasimhan as its new Chief Executive Officer (CEO).

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The new CEO will take over from Howard Schultz, the interim CEO, after taking over from Kevin Johnson, who retired in March this year. Schulz is a legendary figure in Starbucks history and has been called in multiple times in the past to steer the company forward whenever it is in trouble or uncharted waters.

Also read: Best Breakout Stocks To Buy Right Now.

Schultz will hand over the CEO reigns to Narasimhan, an Indian-American business executive adding to a trend adopted by many of the most prominent American public companies of appointing Chief Executives of Indian origin. The practice has generated a lot of public debate in the recent past, and Starbucks’ latest move will add fire to the discussion.

However, we must give credit where it is due. The CEOs of Indian origin have performed excellently after being handed the reigns at large companies such as Alphabet Inc, Microsoft and Google, taking over the companies from founders similar to what is happening at Starbucks.

Going back to our initial question. Will Starbucks’ stock keep rising under the new CEO? The short answer is there are no guarantees. The company’s stock price will be primarily driven by its financial performance after the new CEO takes over.

If Starbucks continues growing its revenues and profits and upholding the strict fair trade standards adopted by Howard Schultz, I see no reason why its stock price should not keep rising. However, if the coffee chain’s performance dips after the new CEO takes over, its share price will likely suffer.

Meanwhile, investors will closely watch the transition process as Laxman Narasimhan comes in on October 1, 2022, but will assume the CEO role in March 2023. Investors will be assessing any new changes implemented by the new CEO and their potential impact on the company’s performance.

*This is not investment advice.

The Starbucks stock price chart.

Starbucks stock price 02-09-2022
Source: Tradingview

The Starbucks stock price is up 8.10% in the past three months. Will, it keep rising under the new CEO?