CFO to retire
On June 28, Starbucks (SBUX) announced that CFO Scott Maw will be retiring at the end of November. He was the second high-profile departure, with Howard Schultz stepping down as executive chairman earlier this month.
Maw joined Starbucks in 2011 as its global controller. Before being promoted to CFO, he served as senior vice president of corporate finance. During the first two years of his tenure as CFO, the company posted strong SSSG (same-store sales growth) and earnings, consistently outperforming analysts’ estimates. However, the Seattle-based coffee chain’s SSSG has been on the low side in the last few quarters.
In a research note, Bonnie Herzog of Wells Fargo Securities stated that she views the departure of Maw as a loss to the company. It appears that many investors agree with her since the stock fell 2.6% on June 28 to close at $48.54.
Starbucks management has filed regulatory filings that say the company is conducting an external search for Maw’s replacement. Maw will serve as a senior consultant after his retirement and through March 31, 2019.
Year-to-date stock performance
Starbucks has been struggling in 2018, with its stock falling 15.5% since the beginning of the year. The stock declined due to slower SSSG in the United States and China.
In the same period, Starbucks’s peers Dunkin’ Brands (DNKN) and McDonald’s (MCD) have returned 7.2% and -9.2%, respectively. The broader comparative indexes, the S&P 500 Index (SPY) and the Consumer Discretionary Select Sector SPDR ETF (XLY) have returned 1.6% and 10.6%, respectively.
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