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Starbucks (SBUX) Stock Moves -0.17%: What You Should Know

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Zacks Equity Research
·3 min read
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Starbucks (SBUX) closed the most recent trading day at $115.16, moving -0.17% from the previous trading session. This change was narrower than the S&P 500's daily loss of 0.41%.

Coming into today, shares of the coffee chain had gained 3.61% in the past month. In that same time, the Retail-Wholesale sector gained 1.33%, while the S&P 500 gained 5.07%.

SBUX will be looking to display strength as it nears its next earnings release, which is expected to be April 27, 2021. In that report, analysts expect SBUX to post earnings of $0.52 per share. This would mark year-over-year growth of 62.5%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $6.79 billion, up 13.2% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.84 per share and revenue of $28.55 billion, which would represent changes of +142.74% and +21.4%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for SBUX. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an 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. Within the past 30 days, our consensus EPS projection has moved 0.25% higher. SBUX is currently sporting a Zacks Rank of #2 (Buy).

Looking at its valuation, SBUX is holding a Forward P/E ratio of 40.67. For comparison, its industry has an average Forward P/E of 40.39, which means SBUX is trading at a premium to the group.

It is also worth noting that SBUX currently has a PEG ratio of 3.39. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Restaurants industry currently had an average PEG ratio of 3.27 as of yesterday's close.

The Retail - Restaurants industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 108, which puts it in the top 43% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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