Reposted from CTH
Credit Suisse is a stock rating entity which generates a sliding scale for future stock valuations based on evaluations of brand sentiment. The scale runs from -100 to +100 with zero as a “hold” or “take no position” recommendation.
Back in January Starbucks announced they were going to stand in opposition to President Trump; and to display their virtuous immigration bona fides they announced their intention to hire 10,000 refugees as employees in lieu of current American applicants for employment.
An almost immediate backlash began as pro-USA consumers and President Trump supporters turned away from the Starbucks brand. As a consequence the Starbucks business model has been severely impacted.
Prior to their virtue-signaling announcement, Starbucks held a +80 position with Credit Suisse. Today that rating dropped to ZERO as analysts announced the latest brand rating against the back drop of significant drops in sales.
(Via CNBC) –Starbucks’ refugee hiring program to counter Trump is hurting brand and sales–
The backlash from some consumers about Starbucks‘ decision to eventually hire 10,000 refugees worldwide could negatively impact sales in the near term, according to analysts at Credit Suisse, who reiterated a hold rating on the coffee seller.
“Our work shows a sudden drop in brand sentiment following announcement of the refugee hiring initiative on Jan. 29th, to flattish from a run-rate of ~+80 (on an index of -100 to +100). Net sentiment has since recovered, but has seen significant volatility in recent weeks,” equity analyst Jason West wrote in a research note. (read more)