Starbucks named top restaurant pick for 2023 at Barclays
Scott Olson

Starbucks Corporation (NASDAQ:SBUX) is Barclays top pick among US restaurants to start 2023.

In a note assessing the space on Thursday, equity analyst Jeffrey Bernstein explained that âlarge and liquidâ operators should outperform in the near term. Additionally, many larger chains maintain pricing power despite concerns on macroeconomic deterioration.

âWe continue to view Starbucks as a premier, large cap, high growth, global consumer company, with a dominant US retail & consumer product platform, significant international growth led by China, and a best-in-class digital platform,â Bernstein wrote. âWe believe few other names offer proven, industry-leading growth at scale, with scarcity value to provide valuation support.â

He added that he expects a full recovery in China as pandemic restrictions are removed rapidly. Continued returns to the office for US workers is also expected to boost sales into 2023.

To be sure, Bernstein added that his bullish view on the stock is predicated upon the avoidance of a deep recession.

âWith that said, for investors that expect a full-fledged recession in 2023, Starbucks would likely underperform,â he warned.
Read more on UBSâ restaurant review.