Incoming Starbucks CEO Kevin Johnson needs to prove to investors that he will be able to navigate managing retail when he replaces Howard Schultz, Morningstar’s RJ Hottovy told CNBC on Friday.
“I think we need to see Kevin Johnson really assert himself as a retail leader, not just as somebody who’s got a background in technology,” Hottovy, a senior restaurant analyst and global director of consumer equity research, said on “Squawk Box.”
Hottovy said Johnson must “show the market … how he’s going to drive same-store sales, because I think that is the key question on investors’ minds.”
Johnson will speak to shareholders at Starbucks’ Investor Day on Wednesday.
Hottovy said “it’s obviously impossible to replace someone with the retail acumen of Howard Schultz,” but after listening to CNBC’sinterview with Schultz and Johnson, he felt somewhat relieved.
“I walked away a lot more impressed with Kevin Johnson,” the analyst said.
Hottovy said it would be worthwhile for Johnson to quickly address the coffee retailer’s long-term initiatives, which include growing its international business and investing in its secondary brands.
Schultz, who will be handing the company’s chief executive seat to Johnson in April, will shift his role to executive chairman and focus on leading Starbucks’ push into higher-end “Roasteries” and expanding its Reserve brand.
“Opening up new Roasteries, and also the Reserve premium bars within existing stores … can add a level of excitement that a lot of other retail brands can’t match right now, so I think that that’s a worthwhile endeavor,” Hottovy said.