Starbucks President and Chief Executive Officer Kevin Johnson is pictured at the Annual Meeting of Shareholders in Seattle, Washington on March 20, 2019.

Jason Redmond | AFP | Getty Images

J.P. Morgan lowered its rating on shares of Starbucks to neutral from overweight on Monday, telling investors in a note that further “upside from here is limited” after the stock has climbed over 90% in the past 12 months. 

“Price performance following F3Q19 results has exceeded our expectations,” J.P. Morgan analyst John Ivankoe said. 

The firm’s move comes after Starbucks stock climbed over 9% after its fiscal third-quarter earnings report beat Wall Street’s expectations on Thursday. The analyst pointed out that Starbucks stock pop was “its biggest one-day gain since November 2,” Ivankoe said, and takes it “to levels well above even our $91 December 2020 price target.”

“Valuation has become beyond a stretch,” Ivankoe said. “Plus, being very late cycle often means continued rising labor costs matched with difficulties of generating sustained increases in same-store traffic.”

Starbucks stock fell 1.3% in premarket trading from its previous close of $99.11 a share. J.P. Morgan stuck to its $91 price target on Starbucks shares. The firm also removed Starbucks from its “Analyst Focus List.”

– CNBC’s Michael Bloom contributed to this report.

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