Starbucks Offers $6 Million Stock Bonus To Execs — But Should You Buy Its Shares? Here's What Technical Analysis Shows - Invesco QQQ Trust, Series 1 (NASDAQ:QQQ), Starbucks (NASDAQ:SBUX)

In order to accelerate its turnaround while managing costs, Starbucks Corp. SBUX has offered stock grants worth $6 million to its executives. Meanwhile, the stock’s technical analysis paints a mixed picture for its momentum.

What Happened: The performance-based awards, in the form of restricted stock units, have a vesting period lasting till the fiscal year 2027, which will end around late September 2027, the company said Wednesday in a regulatory filing.

The grants are contingent on the top executives achieving the targets set by its Chief Executive Officer, Brian Niccol, "as quickly as possible." His turnaround plan is known as Back to Starbucks.

The awards "include a goal of meaningfully reducing operating expenses to support continued investment in the in-store experience," according to the filing.

Since joining in September, Niccol has rapidly implemented several changes, like testing higher staffing and bringing back the condiment bar, to combat declining sales.

It's rare to see companies amend their compensation strategy outside of the usual annual process, said Fabrizio Ferri, a professor at the University of Miami's Herbert Business School, told Bloomberg.

"If you view this as a critical change that either they succeed, or they're basically going to slowly go into obscurity, then the $6 million may not be a big deal if this works," Ferri said.

Why It Matters: Starbucks closed at $94.18 apiece on Thursday, above its eight-day, 20-day, and 50-day simple daily moving averages, indicating short-to-medium term bullish momentum.

However, the stock is trading below the 200-day SMA, which indicates a longer-term trend is still potentially bearish, or that the 200-day SMA is acting as a significant resistance level that the stock needs to break above to confirm a sustained reversal.

According to Benzinga Pro, the relative strength index at 60.77 shows healthy buying interest without being overbought.

The MACD, with a positive histogram of 0.02 and the MACD line of 1.61, was slightly above the signal line of 1.59, confirming recent upward momentum.

Thus, positive short-term indicators, battling against a long-term average that suggests the stock isn’t out of the woods yet from a longer-term perspective, paint a mixed picture.

Price Action: Shares of Starbucks were down 0.032% in premarket on Thursday. It has risen 2.18% on a year-to-date basis and 23.50% over a year.

Benzinga Edge Stock Rankings shows that SBUX had a stronger price trend over the short, medium, and long term. Its momentum ranking was solid, and its value ranking was also poor at the 22.68th percentile. The details of other metrics are available here.

The SPDR S&P 500 ETF Trust SPY and Invesco QQQ Trust ETF QQQ, which track the S&P 500 index and Nasdaq 100 index, respectively, edged higher in premarket on Thursday. The SPY was up 0.16% at $621.45, while the QQQ advanced 0.17% to $551.72, according to Benzinga Pro data.