Starbucks (NASDAQ:SBUX) stock is up 6% in 2021 and 101% since its March 2020 lows, beating the broader market, despite sales declines for the past four quarters. That means investors are confident about the coffee company's prospects for the future, at least in the near term.
Despite hitting a nadir of 65% weekly comparable sales (comps) decline back in April 2020, Starbucks was able to continue operating and innovating -- and grow sales ever since.
The very reasons why Starbucks could thrive in an extremely challenging environment should drive higher sales and profitability even in a decade from now. Let's get in to the details.
Image source: Starbucks.
A thriving coffee brand, pandemic or not
Starbucks had opened several mobile order-only locations even prior to the onset of the pandemic, and it improved its rewards program with updated mobile order features. As a result, this segment increased contribution to total sales by a solid eight percentage points year over year -- from 17% to 25%. Not surprisingly, management sees this continuing to be an important part of growth.