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Starbucks to Bring Plant-Based Menu to China With Beyond Meat

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Starbucks Corporation (SBUX - Free Report) is leaving no stone unturned to attract customers in China. The company’s collaboration with Beyond Meat, Inc. (BYND - Free Report) to roll out a plant-based lunch menu in the country is a testament to the same. 

Now Starbucks customers can enjoy pastas and lasagna made utilizing Beyond Meat's plant-based beef products. It will also include meatless pork alternative known as Omnipork and popular non-dairy milk called Oatley. The new menu will debut at more than 3,300 Starbucks locations in China on Wednesday. Both the companies have already partnered to roll out a plant-based sandwich to Canadian locations.

Starbucks is making every effort to recover from coronavirus-induced shutdown in China. More than 95% of its stores in China are currently operational. However, many are operating with reduced hours and limited seating. In February, China comparable stores sales plunged 78%. However, in March comparable stores sales recovered at a slightly faster pace and the company witnessed a decline of 64%. Moreover, in the last week of March sales declined 42%, representing seventh straight week of sequential improvement.

Moreover, shares of the company were down 18.6% in the past three months, compared with the industry’s decline of 16.6%. The downside can primarily be attributed to the coronavirus pandemic.

Menu Innovation to Drive Growth

Starbucks is strengthening product portfolio with significant innovation around beverages, refreshment, health and wellness, tea and core food offerings. Starbucks is focusing on fast-growing categories like Cold Brew, Draft Nitro beverages, and plant-based modifiers, including almond, coconut, and soy milk alternatives. 

Apart from the numerous beverage innovations, Starbucks has also been making an effort to offer more nutritional and healthy products to customers. Meanwhile, the company’s Reserve Roastery and Tasting Room elevates the coffee experience to the next level, with small-batch super-premium coffee produced using innovative coffee-brewing techniques.

The company currently carries a Zacks Rank #3 (Hold).

Stocks to Consider

Some better-ranked stocks worth considering in the same space include BJ's Restaurants, Inc. (BJRI - Free Report) and Potbelly Corporation (PBPB - Free Report) . Both the stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

BJ's Restaurants and Potbelly have an impressive long-term earnings growth rate of 15% and 17.5%, respectively.

Dine Brands Global’s current-year earnings are likely to witness growth of 4%.

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