Speaking to reporters during an employee conference in New Orlenas, Starbucks (NASDAQ: SBUX) CEO Howard Schultz said (subscription required) that the company "did see a slight improvement in the first few weeks" of the fourth quarter in terms of the average number of transactions per store, "which might suggest that Starbucks has hit bottom."

With the once high-flying growth stock trading at less than one-third of the highs it reached in 2006, that's good news for investors. In the current economic environment, "slight improvement" translates as "incredible news!"

The question is whether the modest signs of a turnaround are coming at the expense of margins, or in a more long-term sense, the company's status as a premium brand. The company has recently begun selling gift cards at Costco (NASDAQ: COST) for a 20% discount.

Still, the fact that the company is making modest progress in its turnaround efforts at a time when nearly every restaurant is struggling, bodes well for the company's future once consumer spending ticks up again.

I first heard the news that Starbucks legend Howard Schultz would once again become CEO of the company via Twitter, and the tidings are accompanied by a generous measure of skepticism: Rick Turoczy asks, "I wonder if this means I'll still get crap coffee 90% of the time?" Baristas and buzz-mongers on Starbucks Gossip seem giddy ("Uncle Howie to the rescue!!!"), although even in the land of the faithful there is some suspicion, calling the decision "smoke and mirrors" and calling exiting CEO Jim Donald a "scapegoat." I call it a classic move for a company whose stock is tumbling: bring back whatever charisma we can yank from the back of the closet.

As Chairman, Howard Schultz was certainly still involved with company and its strategy. But the stock had been plunging throughout 2007 -- and has only tumbled further in 2008 with a downgrade from Bear Stearns. As I wrote in that post, the company's coffee quality was a predictor of its stock price, tumbling from its peak under Schultz previous reign. At one point, the baristas were pulling shots in high-quality, old-fashioned manual machines that coffee connoisseurs agree make far-superior espresso to that made in the newer, idiot-proof automatic models. Drip coffee was routinely thrown away if it was burnt. Now? I have to sweeten my lattes to disguise the taste of inferiority.

Bringing back an old chief executive -- and making a scapegoat (whether expressly in the press release, or just between the lines as is the usual way) of the Jimmy-come-lately CEO -- is a well-worn trick for a once-popular company whose stock is spinning every downward. It only rarely works, and Schultz will have to do a lot more than close stores to bring me back. To get me? You'll have to not only liven up the management team, but also your core product. I want good coffee back.

Investors, other than me, seem as pleased as the baristas -- they have given the stock a nearly-9% boost from its close at $18.38, up $1.65 to $20.03 as of 8 p.m. EST.

Major news from struggling coffee seller Starbucks (NASDAQ: SBUX) this afternoon: CEO Jim Donald is being replaced by Chairman and visionary Howard Schultz, who will lead a major restructuring of the company.

The company said it will close underperforming US stores and slow its pace of expansion. Shares of Starbucks are up more than 8% after-hours, as investors apparently believe the company's problems can be fixed by a strong and highly-respected leader. Donald's resignation and Schulz's decision to return signal that the company's management is aware of its problems and determined to right the ship.

In a PR announcing the shake-up, Schultz said that "I am enthusiastic about returning to the role of chief executive officer for the long term and excited to lead Starbucks and its dedicated partners (employees) to even greater heights of achievement on a global basis. We must address the challenges we face and we know what has to be done. Put simply, we are recommitting ourselves to what has made Starbucks and the Starbucks Experience so unique: ethically sourcing and roasting the highest quality coffee in the world; the relentless focus on the customer; the trust we have built with our people, and the entrepreneurial risk-taking, innovation and creativity that are the hallmarks of our success."

Whether these initiatives will be enough to combat the company's problems and a big push by McDonald's (NYSE: MCD) into Starbucks' territory remains to be seen. But for now, investors are lovin' it.

After Chairman Howard Schultz famous critical interoffice memo, many watchers had dismissed Starbucks Corporation (NASDAQ:SBUX) as a growth-story has-been, nothing more than a fast-food chain whose brand was losing its vigor and for which commoditization was imminent. And then, the stock price fell. And we started to wonder: is Starbucks a bargain? Is Starbucks a has-been that could-be-so-much-more? At today's annual shareholder meeting, Schultz attempted to work up the crowd into a frenzy of belief, reiterating the chain's 40,000 store goal and said the company was planning to "build more in the future than we have in the past."

And, says Schultz, "there's never been a better time to be a Starbucks shareholder." Especially if you've just purchased the stock this week, around $29.50, and not at its 52-week high of nearly $40.

Yes, there's never been a better time to buy Starbucks stock -- at around $32, even after its 2%+ rise today, the stock seems a great price if Schultz' projections are right. At 41x earnings, but a more-than-doubling of stores (and, one would hope, earnings) planned in the next decade, this is a great time to be a Starbucks buyer.

As long as you didn't buy in November or May 2006, it may be a great time to be an owner. I'll let you owners decide for sure.