Nestlé’s Strategic Shift: Blue Bottle Coffee Under Review

The Swiss food and beverage conglomerate Nestlé is undertaking a significant portfolio transformation. Following the recent completion of its exit from the meat business, the company may be preparing for another divestment. According to reports from Reuters and FoodNavigator, the premium coffee chain Blue Bottle Coffee is now under strategic review. This presents an early challenge for the new leadership team in 2026.

The pace of strategic decisions has accelerated under Nestlé's new executive team. Since September 2025, CEO Philipp Navratil has been at the helm, following the departure of his predecessor, Laurent Freixe. Navratil, the former head of Nespresso, faces the task of stabilizing operational margins and reigniting organic growth.

He is supported by Pablo Isla, who assumed the role of Chairman of the Board of Directors in October 2025. Isla, the former chief of Inditex, is recognized as a decisive strategist. Market analysts interpret the duo's swift actions as a clear departure from the company's historical "buy-and-hold" approach, signaling a willingness to divest even long-held assets that fail to meet return expectations.

Portfolio Rationalization Continues

Nestlé has finalized its withdrawal from the processed meat sector. The sale of its remaining 40% stake in Herta to its Spanish partner Casa Tarradellas was completed at the end of December, closing a chapter deemed non-core to the company's renewed strategy. Resources are being redirected toward higher-growth categories.

Should investors sell immediately? Or is it worth buying Nestle?

The potential sale of Blue Bottle Coffee, acquired in 2017, aligns with this sharper strategic focus. The company has reportedly engaged Morgan Stanley to explore strategic options, which may include a sale. This move suggests a pivot away from niche investments toward scalable global brands like Nescafé and Nespresso. Further divestments, including parts of the water business, could follow.

Market Reaction and Technical Analysis

Nestlé shares came under pressure at the open on Friday, declining 1.14% to USD 98.50. From a chart perspective, this move was significant as the stock dipped below its 200-day moving average, which currently sits near USD 99. A prompt recovery above this technical level is viewed as important to prevent further downward momentum.

Despite the recent weakness, the share price remains well above its 52-week low of USD 75.59, recorded in August. The Relative Strength Index (RSI) reading of 51.3 indicates the stock is neither in overbought nor oversold territory.

The Road Ahead

CEO Navratil will present Nestlé's full-year 2025 results in February. This report will be scrutinized for early signs that his efficiency measures are taking effect. Should a sale of Blue Bottle proceed and generate capital for potential share buybacks, it could provide near-term support for the stock. Ultimately, the critical factor for investors will be the new leadership's ability to translate its announced strategic transformation into tangible operational and financial improvements.