Starbucks ETFs Soar, Chipotle Funds Plunge After CEO Shakeup

Senior ETF Analyst

Aug 13, 2024

Reviewed by: etf.com Staff

Edited by: James Rubin

Shares of Starbucks Coffee Company skyrocketed after the company announced that Chipotle CEO Brian Niccol would be taking over as CEO of the firm.

The stock was trading up by as much as 24% Tuesday morning, its largest daily gain on record. The surge underscores just how enthusiastic investors are about Niccol, a highly successful executive who helped spark a turnaround at Chipotle. (Starbucks lost some of its gains more recently but was still up 15%).

Niccol took over the CEO role of the Mexican restaurant chain in 2018, when it was struggling to recover from an E. coli outbreak that had devastated the company’s sales and reputation.

Since then, the stock has soared nearly 700% thanks to Niccol’s leadership, swelling Chipotle’s market cap from less than $9 billion to almost $70 billion in that timeframe.

Based on the stock’s reaction, investors in Starbucks are confident that Niccol could lead a similar turnaround at Starbucks, a company that has been struggling lately.

In its latest earnings report, Starbucks said that its global revenues had declined for a second quarter in a row. Sales at the coffeehouse have been pressured by rising competition and consumers frustrated by the company’s high prices.

Niccol will attempt to put Starbucks back on a growth trajectory.

Starbucks & Chipotle ETFs

There are currently 270 U.S.-listed exchange-traded funds that hold Starbucks stock. Its largest allocation on a percentage basis is in the Opal Dividend Income ETF (DIVZ), the Global X Millennial Consumer ETF (MILN) and the Hennessy Stance ESG ETF (STNC), which holds around 3% of their portfolios in the stock.

etf.com: DIVZ performance

Starbucks is also a 2% holding in the popular VanEck Morningstar Wide Moat ETF (MOAT), as well as the VanEck Morningstar Wide Moat Value ETF (MVAL).

Meanwhile, Chipotle stock can be found in 251 U.S.-listed ETFs. Shares of the chain were down by as much as 14% on Tuesday due to disappointment over Niccol’s departure.

The AdvisorShares Restaurant ETF (EATZ), the Invesco Food & Beverage ETF (PBJ) and the Invesco Leisure And Entertainment ETF (PEJ) each allocate more than 4% of their portfolios to the stock.

Sumit Roy

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Sumit Roy is the senior ETF analyst for etf.com, where he has worked for 13 years. He creates a variety of content for the platform, including news articles, analysis pieces, videos and podcasts.

Before joining etf.com, Sumit was the managing editor and commodities analyst for Hard Assets Investor. In those roles, he was responsible for most of the operations of HAI, a website dedicated to education about commodities investing.

Though he still closely follows the commodities beat, Sumit covers a much broader assortment of topics for etf.com, with a particular focus on stock and bond exchange-traded funds.

He is the host of etf.com’s Talk ETFs, a popular video series that features weekly interviews with thought leaders in the ETF industry. Sumit is also co-host of Exchange Traded Fridays, etf.com’s weekly podcast series.

He lives in the San Francisco Bay Area, where he enjoys climbing the city’s steep hills, playing chess and snowboarding in Lake Tahoe.

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