5 Best Cyclical Stocks To Buy in 2022

3. Starbucks Corporation (NASDAQ:SBUX)

Number of Hedge Fund Holders: 55

Next on our list of cyclical stocks is Starbucks Corporation (NASDAQ:SBUX), the American coffee retailer. On September 28, Starbucks Corporation (NASDAQ:SBUX) declared a $0.53 per share quarterly dividend, an 8.2% increase from its prior dividend of $0.49. The dividend is distributable on November 25, to shareholders of record on November 11. Starbucks Corporation (NASDAQ:SBUX) delivers a dividend yield of 2.21% as of October 5. 

Stephens analyst Joshua Long on September 22 initiated coverage of Starbucks Corporation (NASDAQ:SBUX) with an Equal Weight rating and a $91 price target. While he is optimistic on the stock’s long-term investment story, he prefers to remain neutral as short-term constraints in North America and China affect the company’s traffic and top line, the analyst told investors. In the long-term, Starbucks Corporation (NASDAQ:SBUX)’s brand strength, scale, rewards program, and high coffee consumption positions the company for growth.

According to Insider Monkey’s data, 55 hedge funds were bullish on Starbucks Corporation (NASDAQ:SBUX) at the end of Q2 2022, compared to 58 funds in the last quarter. Ray Dalio’s Bridgewater Associates is a significant position holder in the company, with 3.2 million shares valued at $247.7 million. 

Here is what Matrix Asset Advisors specifically said about Starbucks Corporation (NASDAQ:SBUX) in its Q2 2022 investor letter:

“Starbucks Corporation (NASDAQ:SBUX) is a premiere global coffee brand supported by over 32,600 stores across the world. The firm has a long history of beverage innovation and strong employee/barista relations with the firm paying above-market wages and benefits. Starbucks has a strong balance sheet and finances. The company generates steady and consistent cash flow, selling millions of cups of premium coffee every day. The company’s share price declined in part due to its large business in China which was largely shut down due to Covid restrictions and because of rising commodity and labor costs. We think the shares are attractively priced for a company that should grow 10% plus per year with a dividend yield of 2.6% at our average cost.”