Benzinga | Dec 7, 2021 01:16PM EST

MKM Partners Turns Bullish On Starbucks - Read Why

* MKM Partners analyst Brett Levy upgraded Starbucks Corp (NASDAQ:SBUX) to Buy from Neutral with a price target of $130, up from $114, implying an 11.5% upside.

* The analyst, who acknowledged the current backdrop, the company's investments, and a "fundamental drag" may weigh on its near-term performance, took a "more constructive view" of Starbucks' long-term prospects.

* Levy said the decision to invest $1 billion across its system has created a short-term drag on fundamentals, but solidifying the company's operating model and putting its "partners" and customers first, it could further enhance the longer-term sales and profit streams over time.

* Price Action: SBUX shares are trading higher by 2.85% at $116.60 on the last check Tuesday.