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Starbucks Introduces Teavana in India, Expands Globally
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Starbucks Corporation (SBUX - Free Report) is all set to expand its global tea business with introduction of the Teavana range in India. This American coffeehouse chain is betting on India’s large tea-drinking population as the nation is considered to be the world's third-highest tea-consuming country.
Starbucks launched its Teavana speciality teas in India on Jan 18, through Tata Starbucks Pvt. Ltd, a joint venture between Starbucks and Tata Global Beverages. With this initiative, the company aims to double its tea offering with the new range. Notably, the company already serves nine varieties of tea in India.
In 2012, Starbucks acquired Teavana, a specialty tea retailer for $620 million. Teavana currently serves more than 400 locations across the U.S., Canada, Mexico, Puerto Rico and the Middle East. The company has 88 stores in India, co-existing with major players like Café Coffee Day, Barista, Costa Coffee and Di Bella Coffee, among others.
Some 18 different tea offerings have been introduced under Teavana, with a special India blend, jointly developed by Tata Global Beverages and Starbucks.
Sumitro Ghosh, CEO, Tata Starbucks Pvt. Ltd. expects that this initiative will aid the company to double its revenue this year.
Expanding Beyond the U.S.
The U.S. beverage major is gaining popularity with consumers across Asia as the company is increasingly investing in the Asian markets. The relatively low per-capita consumption as well as a burgeoning middle class with rising income levels increase the demand for convenience food and beverages, and consequently, promise significant growth potential.
Management believes that China and the Asia-Pacific region will drive much more meaningful business growth over the next five years driven by rapid unit growth, growing brand awareness, and increased usage of the digital/mobile/loyalty platforms.
As revealed in its recent five-year growth plan, the company outlined its intention to drive earnings by 15–20%, as well as mid-single digit comps growth each year. To achieve this, Starbucks plans to open roughly 12,000 new stores worldwide by 2021, taking the total tally to nearly 37,000 stores. This apart, the company will continue to boost the Starbucks Experience globally.
Stock Performance
Starbucks shares have struggled in the last one year on concerns about the company's growth outlook. The stock has lost around 0.2%, almost in-line with the 0.3% decline witnessed by the Zacks categorized Retail-Food & Restaurants industry. Estimates have been steady ahead of the company's earnings release on Jan 26. The company is expected to report quarterly EPS of 52 cents per share (reflecting 13.2% year-over-year growth) on $5.83 billion revenues (8.5%).
This Seattle-based coffee giant currently carries a Zacks Rank #2 (Buy).
Other Stocks Worth a Look
Other favorably placed stocks in the industry include Bob Evans Farms, Inc. , Dave & Buster's Entertainment, Inc. (PLAY - Free Report) and Cracker Barrel Old Country Store, Inc. (CBRL - Free Report) .
Bob Evans is expected to witness 10.9% growth in fiscal 2017 earnings while Dave & Buster's is likely to grow 35%.
For Cracker Barrel – a Zacks Rank #2 stock – estimates have moved north by 1.2% for fiscal 2017 earnings.
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Starbucks Introduces Teavana in India, Expands Globally
Starbucks Corporation (SBUX - Free Report) is all set to expand its global tea business with introduction of the Teavana range in India. This American coffeehouse chain is betting on India’s large tea-drinking population as the nation is considered to be the world's third-highest tea-consuming country.
Starbucks launched its Teavana speciality teas in India on Jan 18, through Tata Starbucks Pvt. Ltd, a joint venture between Starbucks and Tata Global Beverages. With this initiative, the company aims to double its tea offering with the new range. Notably, the company already serves nine varieties of tea in India.
In 2012, Starbucks acquired Teavana, a specialty tea retailer for $620 million. Teavana currently serves more than 400 locations across the U.S., Canada, Mexico, Puerto Rico and the Middle East. The company has 88 stores in India, co-existing with major players like Café Coffee Day, Barista, Costa Coffee and Di Bella Coffee, among others.
Some 18 different tea offerings have been introduced under Teavana, with a special India blend, jointly developed by Tata Global Beverages and Starbucks.
Sumitro Ghosh, CEO, Tata Starbucks Pvt. Ltd. expects that this initiative will aid the company to double its revenue this year.
Expanding Beyond the U.S.
The U.S. beverage major is gaining popularity with consumers across Asia as the company is increasingly investing in the Asian markets. The relatively low per-capita consumption as well as a burgeoning middle class with rising income levels increase the demand for convenience food and beverages, and consequently, promise significant growth potential.
Management believes that China and the Asia-Pacific region will drive much more meaningful business growth over the next five years driven by rapid unit growth, growing brand awareness, and increased usage of the digital/mobile/loyalty platforms.
As revealed in its recent five-year growth plan, the company outlined its intention to drive earnings by 15–20%, as well as mid-single digit comps growth each year. To achieve this, Starbucks plans to open roughly 12,000 new stores worldwide by 2021, taking the total tally to nearly 37,000 stores. This apart, the company will continue to boost the Starbucks Experience globally.
Stock Performance
Starbucks shares have struggled in the last one year on concerns about the company's growth outlook. The stock has lost around 0.2%, almost in-line with the 0.3% decline witnessed by the Zacks categorized Retail-Food & Restaurants industry. Estimates have been steady ahead of the company's earnings release on Jan 26. The company is expected to report quarterly EPS of 52 cents per share (reflecting 13.2% year-over-year growth) on $5.83 billion revenues (8.5%).
This Seattle-based coffee giant currently carries a Zacks Rank #2 (Buy).
Other Stocks Worth a Look
Other favorably placed stocks in the industry include Bob Evans Farms, Inc. , Dave & Buster's Entertainment, Inc. (PLAY - Free Report) and Cracker Barrel Old Country Store, Inc. (CBRL - Free Report) .
Bob Evans and Dave & Buster's, both sport a Zacks Rank #1 (Strong Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.
Bob Evans is expected to witness 10.9% growth in fiscal 2017 earnings while Dave & Buster's is likely to grow 35%.
For Cracker Barrel – a Zacks Rank #2 stock – estimates have moved north by 1.2% for fiscal 2017 earnings.
"Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>"