Starbucks (SBUX) Stock: Coffee Chain Targets 2,000 New Stores as Analyst Lifts Price Target

TLDR

• Starbucks unveils plan to open over 2,000 stores worldwide in Fiscal 2028, three times this year’s total
• U.S. expansion includes 400 new company-operated locations by 2028, with potential for 5,000 more long-term
• New “Ristretto” store design reduces construction costs by approximately 20%
• China expansion targets 15,000 to 20,000 additional stores on top of current 8,000 locations
• TD Cowen raises price target from $84 to $89, maintains Hold rating on shares

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Starbucks is gearing up for its largest expansion in years. The coffee giant announced plans to open more than 2,000 stores globally in Fiscal 2028.

Starbucks Corporation, SBUX

That represents three times the number expected this year. CFO Cathy Smith revealed the strategy at a recent investor event following mixed first-quarter earnings.

The expansion marks a turnaround. Last year, Starbucks shuttered underperforming locations. Now the company is doubling down on growth.

The U.S. market will see 400 new company-operated stores by 2028. But executives aren’t stopping there. They envision adding up to 5,000 more American locations in subsequent years.

New stores will concentrate in central, southern, and northeastern states. These regions face growing competition from drive-through chains like 7 Brew and Dutch Bros.

Redesigned Stores Lower Building Expenses

Starbucks is overhauling its store blueprint. New locations will function as multi-service hubs handling drive-through, mobile orders, delivery, and in-store customers.

Urban markets without space for drive-throughs will get smaller cafe formats. The “Ristretto” concept offers a compact design with full coffee bars and seating.

These updated layouts slash construction costs by roughly 20%. With thousands of stores planned, those savings become substantial.

International Push Focuses on China

Starbucks operates nearly 23,000 international stores. Leadership believes that figure could hit 40,000 over time.

China represents the crown jewel. The company runs 8,000 Chinese locations now. It plans to add 15,000 to 20,000 more.

Starbucks recently sold a majority stake in its China operations to Boyu Capital. The deal transitions most international stores to a licensed model.

After the transaction closes, roughly 90% of overseas locations will be licensee-operated. That’s up from 55% today.

Licensing allows faster expansion with reduced capital requirements. Local partners manage operations and shoulder more financial risk.

Analyst Upgrades Price Target

TD Cowen analyst Andrew Charles boosted his Starbucks price target to $89 from $84. He kept a Hold rating on the stock.

Charles described Starbucks as a momentum play given improved visibility on 2028 earnings guidance. He noted shares trade at a peak 32-times forward-earnings multiple.

The analyst expects further multiple expansion if North America same-store sales accelerate beyond the 4% first-quarter growth rate.

Wall Street holds a Moderate Buy consensus on Starbucks. The rating stems from 13 Buy, seven Hold, and two Sell recommendations. The average analyst price target sits at $98.22, suggesting nearly 2% upside potential from current levels.

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