Starbucks (SBUX, $71.50) revamps loyalty program to woo customers
American multi-national coffee giant, Starbucks, recently announced it is revamping its rewards program, a decision in-line with the company’s strategy to bring even more people into the program by offering more choice and by being more attractive.
Starting April 16th, the coffee company's rewards members would start earning reward points sooner and would also have more options when redeeming points. Presently, this program reward program would be applicable for its customers in the United States and Canada, and with time would be rolled out in other locations also.
The rewards program is not only expected to please the company's super-loyal customers, who account for nearly 40% of sales at U.S. stores. It is also expected to help the company learn more about their customers.
Currently, the rewards program gives its customers two points or stars for every dollar they spend. But a customer needs to hit 300 stars within one year in order to start qualifying for rewards. Once qualified for rewards, the customer can get a free drink or free food for every 125 stars. However, if the customer holds on to the points until they reach 250, they can redeem the points for two free drinks, two food items or one of each.
Under the new rewards system, customers would get different rewards for different amounts of stars, and it starts at a lower tier also. Members can cash-in 25 stars for an extra espresso shot, dairy substitute or another flavor pump. For 50, one can get coffee or tea or a bakery item, and so on.
According to the company’s chief marketing officer, Matthew Ryan, an enhanced flexibility would enable the company to serve more types of customers. Presently, Starbucks Loyalty Rewards program has ~16 million members and has seen 25% membership growth in the last two years.
Momentum Indicator for SBUX turns positive, indicating new upward trend
SBUX saw its Momentum Indicator move above the 0 level on November 08, 2024. This is an indication that the stock could be shifting in to a new upward move. Traders may want to consider buying the stock or buying call options. Tickeron's A.I.dvisor looked at 96 similar instances where the indicator turned positive. In of the 96 cases, the stock moved higher in the following days. The odds of a move higher are at .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Moving Average Convergence Divergence (MACD) for SBUX just turned positive on November 11, 2024. Looking at past instances where SBUX's MACD turned positive, the stock continued to rise in of 53 cases over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where SBUX advanced for three days, in of 292 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 214 cases where SBUX Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 4 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where SBUX declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
SBUX broke above its upper Bollinger Band on November 22, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (0.000) is normal, around the industry mean (10.792). P/E Ratio (30.955) is within average values for comparable stocks, (59.102). Projected Growth (PEG Ratio) (2.073) is also within normal values, averaging (1.865). Dividend Yield (0.023) settles around the average of (0.037) among similar stocks. P/S Ratio (3.221) is also within normal values, averaging (8.692).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating outstanding price growth. SBUX’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 83, placing this stock slightly better than average.
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General Information
a producer of coffee and tea
Industry Restaurants