It’s been a tough period for most Restaurant stocks as lockdown initiatives have forced closures across the country. And while a select few who had digital sales systems in place before the pandemic have done just fine – think Chipotle Mexican Grill (CMG) – most others have had to shift gears quickly to bring sales levels up.
Starbucks (SBUX) has been doing just that as the company has continued to innovate from its Seattle-based Tryer Center, where employees can test and try beverages, build new equipment and create processes that make customer’s experience more efficient. The new innovations have pushed sales higher, with 90% now coming from digital or drive-through traffic.
News of the positive transition has helped pushed the stock into an uptrend, with last week’s break back above its 200-day moving average on volume now putting SBUX in a new uptrend.
With the MACD and RSI both in positive territory, I would look for the stock to bullishly break out of a 10-week base at $83.6 for even more confirmation of further upside is ahead.
For those who subscribe to my MEM Edge Report, you’ll know that we highlighted Chipotle (CMG) back in April when it first turned bullish, along with the many other leading stocks we identified that are now up significantly. (You can look at our performance here!)
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Mary Ellen McGonagle, MEM Investment Research