Starbucks (SBUX) closed the most recent trading day at $92.09, moving -1.11% from the previous trading session. This change lagged the S&P 500's 0.39% loss on the day. Elsewhere, the Dow saw a downswing of 0.61%, while the tech-heavy Nasdaq depreciated by 0.32%.
Prior to today's trading, shares of the coffee chain had lost 7.25% over the past month. This has lagged the Retail-Wholesale sector's gain of 7.99% and the S&P 500's gain of 3.6% in that time.
Market participants will be closely following the financial results of Starbucks in its upcoming release. In that report, analysts expect Starbucks to post earnings of $0.66 per share. This would mark a year-over-year decline of 26.67%. Meanwhile, our latest consensus estimate is calling for revenue of $9.33 billion, down 1% from the prior-year quarter.
For the full year, the Zacks Consensus Estimates are projecting earnings of $3.11 per share and revenue of $37.33 billion, which would represent changes of -6.04% and +3.18%, respectively, from the prior year.
Investors should also pay attention to any latest changes in analyst estimates for Starbucks. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. 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 ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 1.34% decrease. Right now, Starbucks possesses a Zacks Rank of #5 (Strong Sell).
Investors should also note Starbucks's current valuation metrics, including its Forward P/E ratio of 29.93. This indicates a premium in contrast to its industry's Forward P/E of 25.34.
We can additionally observe that SBUX currently boasts a PEG ratio of 2.73. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Retail - Restaurants industry had an average PEG ratio of 2.33 as trading concluded yesterday.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. Currently, this industry holds a Zacks Industry Rank of 130, positioning it in the bottom 49% 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.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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