Don’t Buy Starbucks Stock (SBUX), Says Wolfe Research. Buy This Coffee Company Instead

FomoAnxiety · 2026-03-09T17:32:44+00:00

Wolfe Research downgraded Starbucks to a Hold rating due to increasing competition, recommending investors consider Dutch Bros instead, which has strong growth potential and a loyal customer base.

FomoAnxiety

2026-03-09 17:32:44

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Wolfe Research has downgraded Starbucks’s (SBUX) stock to a Hold rating from Buy previously, citing rising competition in the coffee space.

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Analyst Margaret-May Binshtok says that some good things are happening with the turnaround at Starbucks that’s being executed under CEO Brian Niccol. However, Wolfe Research remains concerned about the competitive landscape in the coffee world, especially in the U.S.

Rather than buy SBUX stock, Binshtok is recommending that investors take a position in rival company Dutch Bros (BROS). The analyst has initiated coverage of BROS stock with a Buy rating and a price target of $77. The price target is 54% higher than where Dutch Bros. stock is currently trading.

SBUX vs. Bros

Regarding SBUX stock, Margaret-May Binshtok wrote in a note to clients that, “An intensifying competitive landscape, driven by high-growth smaller peers gaining share, could cap the comp recovery and constrain pricing power, even with multiple levers in play.”

On the flipside, the Wolfe Research analyst writes of Dutch Bros. that the Arizona-based company is a “nationally scaling brand with a clear path for mid-teens percentage unit growth.” Binshtok also notes that Dutch Bros has multiple levers to sustain its sales momentum in 2026 and beyond and that the company has developed a “loyal customer base.”

Stock Comparison

Below is a chart comparing the stocks of Starbucks and Dutch Bros.

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