In the latest close session, Starbucks (SBUX) was down 1.47% at $84.17. The stock's performance was behind the S&P 500's daily gain of 0.21%. At the same time, the Dow added 0.25%, and the tech-heavy Nasdaq gained 0.45%.
Shares of the coffee chain witnessed a loss of 7.26% over the previous month, trailing the performance of the Retail-Wholesale sector with its gain of 5.92%, and the S&P 500's gain of 3.07%.
Analysts and investors alike will be keeping a close eye on the performance of Starbucks in its upcoming earnings disclosure. In that report, analysts expect Starbucks to post earnings of $0.59 per share. This would mark a year-over-year decline of 26.25%. Alongside, our most recent consensus estimate is anticipating revenue of $9.43 billion, indicating a 3.91% upward movement from the same quarter last year.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $2.2 per share and a revenue of $37.04 billion, representing changes of -33.53% and +2.4%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for Starbucks. These recent revisions tend to reflect the evolving nature of short-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 1.34% lower. Right now, Starbucks possesses a Zacks Rank of #4 (Sell).
In the context of valuation, Starbucks is at present trading with a Forward P/E ratio of 38.8. This indicates a premium in contrast to its industry's Forward P/E of 20.22.
Also, we should mention that SBUX has a PEG ratio of 5.09. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The average PEG ratio for the Retail - Restaurants industry stood at 2.31 at the close of the market yesterday.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 191, putting it in the bottom 23% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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Starbucks Corporation (SBUX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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