Howard Schultz To Step Down As Starbucks Chair

Starbucks Corporation SBUX executive chairman Howard Schultz, who had led the company’s expansion from a single shop to a global chain, announced late Monday he will resign from his role June 26. Myron Ullman, former chairman and CEO of J C Penney Company Inc JCP, will become chair.

"I'll be thinking about a range of options for myself, from philanthropy to public service, but I'm a long way from knowing what the future holds," Schultz said in a memo.

The news catalyzed a 2-percent stock drop in after-hours trading.

“Absolutely it’s a buying opportunity,” Tigress Financial CIO Ivan Feinseth said of the stock’s immediate weakness.

Why It's Important

Although shares largely recovered, precedent suggests they may face a difficult Tuesday. In 2016, when Schultz announced his transition from chairman and CEO to executive chairman, the stock dipped about 2.2 percent the following day. It regained all losses within four trading sessions.

Feinseth was generally unfazed by news of Schultz’s departure and assured Benzinga that Starbucks retains a “strong bench” of managers driving many new initiatives to take the company “to the next level.”

He expressed particular excitement for a rollout of reserve stores; a rollout in China; an expansion of food offerings; the new deal with Nestle; digital ordering; and the loyalty platform.

By Tuesday's pre-market session Starbucks was set to open down less than 1 percent at $56.55.

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