With the cost of energy and dairy soaring, Starbucks will hike prices for the second time in less than a year at the end of the month. The 3% jump means an average 9-cent increase for coffees, lattes, and Frappuccinos, the AP reports. The hike applies to company-owned stores; licensed operators usually follow suit, a spokesman tells the Seattle Post-Intelligencer.
Starbucks is under pressure from investors to beef up its bottom line, Reuters reports, and analysts view the relatively small increase as a solid strategy. "It should definitely be a positive on both sales and earnings going forward," says one analyst. Starbucks stock, which has dropped more than 20% this year, closed up 47 cents at $28.17.