Starbucks (SBUX) closed the most recent trading day at $82.28, moving -1.35% from the previous trading session. This change lagged the S&P 500's 0.09% loss on the day. Meanwhile, the Dow lost 0.38%, and the Nasdaq, a tech-heavy index, added 0.13%.
Shares of the coffee chain witnessed a loss of 1.41% over the previous month, trailing the performance of the Retail-Wholesale sector with its loss of 1.16%, and the S&P 500's gain of 1.89%.
The upcoming earnings release of Starbucks will be of great interest to investors. On that day, Starbucks is projected to report earnings of $0.6 per share, which would represent a year-over-year decline of 13.04%. Meanwhile, the latest consensus estimate predicts the revenue to be $9.64 billion, indicating a 2.62% increase compared to the same quarter of the previous year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $2.4 per share and a revenue of $38.49 billion, indicating changes of +12.68% and +3.5%, respectively, from the former year.
It is also important to note the recent changes to analyst estimates for Starbucks. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 3.76% decrease. As of now, Starbucks holds a Zacks Rank of #4 (Sell).
Looking at its valuation, Starbucks is holding a Forward P/E ratio of 34.81. This expresses a premium compared to the average Forward P/E of 20.3 of its industry.
We can additionally observe that SBUX currently boasts a PEG ratio of 1.7. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. SBUX's industry had an average PEG ratio of 2.22 as of yesterday's close.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 197, putting it in the bottom 21% of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming 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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