Jefferies analysts lowered their rating of Starbucks stock to Underperform, saying the new CEO Brian Niccol isn’t a miracle worker. Andy Barish, Jefferies’s managing director, joins Julie Hyman and Josh Lipton on Market Domination Overtime to discuss his view on the coffee company stock.

“There is no magic bullet here. We do respect Brian quite a lot and obviously, the analogue from Chipotle (CMG) when he joined in 2018 has been thought about and thrown around. But this is a much larger, complicated global business that we think kind of needs a reset from a culture, people, and operations perspective. And that's a lot,” Barish tells Yahoo Finance.

He says “That's going to involve having to really build out the team. And we've already seen some changes like Mike Conley announcing he's going to be leaving Starbucks before year-end. And I wouldn't be surprised to see others. So first, the team has to come in with Brian and then start to stabilize the people and operational side of things. And then I think you can start to paint the path to what the rest of this turnaround might look like as we move forward.”

Barish says that expectations around Starbucks’s growth, sales, and margin expansion have been set so high it “runs counter to the ability to get an operational turnaround established and underway. It just puts a lot more pressure on the organization.”

He says, “We think it would behoove Brian and the company to slow down the unit growth, not shoot for mid-single digit same-store sales, but maybe low single digits would be an achievable and maybe beatable target at some point. And that kind of gets you to low double-digit earnings growth, which, for a company of this size, is certainly still very admirable.”

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This post was written by Naomi Buchanan.