(Bloomberg) -- It’s too early to get excited about Starbucks Corp.’s prospects for a turnaround even with a new chief executive officer in charge, Jefferies analysts said, assigning a rare sell-equivalent rating to the struggling coffee chain operator.

Most Read from Bloomberg

• Unlocking the Hidden Power of Zoning, for Good or Bad

• The Moonshot Plan to Eliminate Deaths on America’s Roads

• Belfast’s Grand Central Station Creates New Era for Northern Ireland’s Public Transport

Starbucks shares surged 24% through Monday’s close since the sudden replacement of its CEO with Chipotle Mexican Grill Inc.’s Brian Niccol in August. Yet for Jefferies’ Andy Barish, this rally is “overdone,” given the path to improving the business isn’t a straightforward one.

“While the new CEO suggests necessary strategic change is now on the table, we believe execution will be challenged as issues like ops, culture, value perception and tech take time to fix,” Barish said in a research note. His lowered price target of $76, a Street low, sees the stock falling 20% over the next 12 months from Monday’s closing price of $95.48.

While fellow Wall Street analysts have rushed to upgrade Starbucks since the leadership change, Barish cut Starbucks to underperform. That’s one of only two sell-equivalent ratings, according to data compiled by Bloomberg, and the analyst’s first since initiating coverage of the US firm in 2011.

Starbucks shares remain in negative territory for the year as the coffee roaster struggles to stem a decline in sales, with customers baulking at splashing out on pricey lattes. The stock fell 2.2% in premarket trading Tuesday in New York.

Most Read from Bloomberg Businessweek

• Palantir’s CEO and Wall Street Annoy Each Other Straight to the Bank

• Five Reasons to Be Optimistic About the Entertainment Business

• The Man Who Made Nike Uncool

• In Yosemite, Problems With Concessions Keep Piling Up

• Threats to Local US Election Officials Are Rising, and More Workers Are Quitting

©2024 Bloomberg L.P.