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What the Schultz Departure Means for Starbucks

The wide-moat firm has one of the deepest benches in the consumer industry, and we're maintaining our fair value estimate.

Securities In This Article
Starbucks Corp
(SBUX)

Few executives are as closely associated with their brand as Howard Schultz is with

We're not planning any changes to our $68 fair value estimate or our Exemplary stewardship rating. While we recognize investor frustration with U.S. comp trends and still believe they will take time to stabilize, we believe the combination of China's leadership, new channel diversification opportunities, and capital allocation ($20 billion expected to be returned to shareholders between 2018 and 2020) offers several reasons to stay with this name.

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About the Author

R.J. Hottovy

Sector Strategist
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R.J. Hottovy, CFA, is a consumer strategist for Morningstar Research Services LLC, a wholly owned subsidiary of Morningstar, Inc. He is responsible for consumer discretionary and staples research. He has covered the consumer sector as an analyst and director of global consumer equity research for Morningstar since joining the company in 2008, and specializes in a broad range of consumer categories including restaurants, footwear and apparel retailers, consumer electronics retailers, fitness clubs, home improvement and furnishing retailers, and consumer product manufacturers.

Before joining Morningstar, Hottovy was a director and senior stock analyst for Next Generation Equity and an analyst for William Blair & Co., specializing in a wide range of retail and consumer product companies. He also spent two years at Deutsche Bank, covering waste management, water utilities, and equipment rental stocks.

Hottovy holds a bachelor’s degree in finance and a second degree in computer applications from the University of Notre Dame, where he graduated magna cum laude. He also holds the Chartered Financial Analyst® designation and is a member of the CFA Institute and the CFA Society of Chicago.

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