Starbucks Corp (NASDAQ:SBUX) is brewing up big changes ahead of its first-quarter earnings.
Starting Monday, only paying customers—or those accompanying them—will be allowed to use its cafés, patios, and restrooms. Free water is out, and baristas have been trained to enforce the new rules.
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Starbucks Remains Bullish Despite Controversy
Starbucks' stricter stance is a reversal of its 2018 policy that allowed anyone to use its stores, a decision made after backlash from the arrest of two men at a Philadelphia location.
While the new crackdown is already sparking debate, investors don't seem rattled, reported The Financial Times.
Starbucks stock remains firmly bullish, trading at $98.81, above its key moving averages. The stock is signaling strong buying pressure, with the eight-day, 20-day and 50-day SMAs all pointing to further upside.
The moving average convergence/divergence (MACD) indicator at 0.98 and a relative strength index (RSI) of 66.69 suggest momentum is on Starbucks' side heading into earnings.
Will Earnings Brew A Breakout?
With expectations already tempered by falling traffic, Starbucks' earnings report could be a key catalyst.
If sales show signs of stabilizing, the stock's bullish trend may extend. But if the crackdown backfires, investors may have second thoughts about the coffee giant's recovery plan.
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