|Bid||68.94 x 1300|
|Ask||68.96 x 1100|
|Day's Range||67.77 - 69.27|
|52 Week Range||56.77 - 77.13|
|Beta (3Y Monthly)||0.94|
|PE Ratio (TTM)||15.35|
|Earnings Date||Feb 4, 2019 - Feb 8, 2019|
|Forward Dividend & Yield||1.39 (2.06%)|
|1y Target Est||73.11|
Can the coffee firm's recent run of success continue with Starbucks set to report its quarterly financial results after the closing bell Thursday?
Can SBUX Overcome the Chinese Slowdown to Post Robust Q1 Results?(Continued from Prior Part)Analysts’ recommendations Of the 33 analysts who follow Starbucks (SBUX), 48.5% have given it “buy” ratings, 48.5% have given it “hold” ratings, and
Can SBUX Overcome the Chinese Slowdown to Post Robust Q1 Results?(Continued from Prior Part) Analysts’ EPS expectations Analysts expect Starbucks’s (SBUX) adjusted EPS to rise 11.9% to $0.65 in the first quarter of fiscal 2019 compared to $0.58
Can SBUX Overcome the Chinese Slowdown to Post Robust Q1 Results?(Continued from Prior Part)Analysts’ revenue expectationsIn the first quarter of fiscal 2019, analysts expect Starbucks (SBUX) to post revenue of $6.49 billion, a rise of 6.8% from
Can SBUX Overcome the Chinese Slowdown to Post Robust Q1 Results?SBUX’s performanceStarbucks (SBUX) is expected to post its fiscal 2019 first-quarter earnings results after the market closes on January 24.As of January 17, the company’s stock
Did you hear that? That was the world's largest company, Apple (NASDAQ:AAPL), firing a warning shot about slowing growth in the world's hottest economy, China. Everyone heard the shot when it was first fired on January 2. Stocks across the board dropped. But now, less than two weeks later, everyone has seemingly forgotten about that warning shot, and stocks are in rally mode. That's fair. Stocks, by and large, are undervalued, and other risk factors are improving, such as the Fed becoming more dovish and U.S.-China trade talks progressing nicely. But, China's economy is still cooling, and that's bad news for companies with broad exposure to China, regardless of how other risk factors are playing out. One such company is retail coffee giant Starbucks (NASDAQ:SBUX). For all intents and purposes, due to dried up growth everywhere else, the Starbucks stock growth narrative is entirely centered around China. Given Apple's warning shot, that's a worrisome position to be in. Indeed, Goldman Sachs recently downgraded Starbucks stock to Neutral due to the company's broad exposure to the slowing China economy. Goldman actually warns that Starbucks could issue a warning like Apple about slowing growth in the near future. InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Stocks to Buy That Are Run By Billionaires Goldman hit the nail on the head with this downgrade. To warrant its current valuation, Starbucks stock needs everything to go right. But, because of Apple's warning, we know everything isn't going right in the most important region for the coffee giant. Thus, the current valuation seems due for compression based on weakening growth trends, and that's reason enough to stay away from Starbucks stock in the near term. ### Worrisome Exposure To China The core of the near-term bear thesis on Starbucks stock is that the company has a worrisome level of exposure to China, and that if growth in China falls apart, SBUX's long-term growth narrative will substantially weaken, causing the stock to drop meaningfully. It's not all bad news in China, though. This is still a 6%-plus growth economy. And, while Apple recently issued a big warning about slowing growth in China, Nike (NYSE:NKE) announced two weeks prior that its China business was red hot. My fear, however, is that Starbucks is on the Apple path in China, not the Nike path. Over the past several quarters, Nike's business has been heating up globally. Apple's business has been cooling. So has Starbucks' business. Thus, Nike's ability to maintain strong growth in China is more a function of outstanding operational momentum than anything else. Starbucks doesn't have that. Instead, Starbucks is more comparable to Apple in that growth is positive, but slowing from its multi-year trend. From this perspective, the present situation for Starbucks in China is most likely one defined by slowing growth. That's a big problem. Growth everywhere else is all dried up due to rising competition and saturation. Comparable sales growth in the U.S. has dropped from 5% and up a few years back, to 2% last year, with transaction volume actually down year-over-year. Europe, Middle East, and Africa comps have followed a similar trajectory, also with negative transaction volume growth last year. Thus, the SBUX growth narrative is all about China. If China falls apart, so does this growth narrative, meaning that if China numbers are weak next quarter (as they should be), then Starbucks stock will drop meaningfully. ### Valuation Has Room To Fall In relation to what is likely substantial sales pressure in China, the valuation on Starbucks stock is a tough pill to swallow. Starbucks stock trades at 24x forward earnings. That's below the stock's five-year forward multiple of 25. But, the company is also growing much less quickly today than it has over the past five years. Thus, a lower valuation is warranted. With respect to its peers, that 24 forward multiple actually seems stretched. The forward P/E multiple across the whole restaurant industry hovers right around 22. McDonald's (NYSE:MCD) trades at 22x forward earnings. Dunkin' (NYSE:DNKN) trades at 23x forward earnings. Yum (NYSE:YUM), Jack In The Box (NASDAQ:JACK), and El Pollo Loco (NASDAQ:LOCO) all trade around 18 to 23x forward earnings. Thus, relative to other mid-to-large cap restaurant names with fairly slow but stable growth, Starbucks stock still trades at a premium -- despite worrisome exposure to China. That means that if China's numbers do come in below expectations, SBUX stock could get hit by sizable valuation compression. * 10 A-Rated Stocks the Smart Money Is Piling Into ### Bottom Line on SBUX Stock Starbucks stock is a solid long-term holding given the company's staying power in a stable growth global retail coffee industry. But, at the present moment, the valuation seems overstretched with sizable operational risks on the horizon. That means the near to medium term outlook for this stock skews bearish, despite stable long term fundamentals. As of this writing, Luke Lango was long AAPL and NKE. ### More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Key Emerging-Market Stocks to Buy for Contrarian Investors * 7 Stocks at Risk of the Global Smartphone Slowdown * 7 Pharmaceutical Stocks That Just Raised Prices This Year Compare Brokers The post Apple's Warning Is a Reason to Avoid Starbucks Stock appeared first on InvestorPlace.
Why Goldman Sachs Downgraded Starbucks Today ## Goldman Sachs’s downgrade Today, Goldman Sachs downgraded Starbucks (SBUX) from a “buy” to a “neutral” due to concerns about its expansion in China, Starbucks’s second-largest market. Goldman Sachs also lowered its price target from $75 to $68. The new price target represents a potential upside of 5.9% from the stock’s January 10 closing price of $64.19. As reported by CNBC, Goldman Sachs analyst Karen Holthouse wrote in a research note, “The recent AAPL [Apple] announcement (while potentially also product-driven) cited trade concerns/macro, and MCD [McDonald’s] acknowledged softer trends in the region at a late November event. The GS macro team also expects a continued slow down in GDP, at least partially driven by consumption.” ## Other analysts’ recommendations Of the 33 analysts that follow Starbucks, 48.5% are favoring “buys,” 48.5% are favoring “holds,” and 3.0% are favoring “sells” on the stock. On average, analysts have given SBUX a price target of $68.44, which represents a potential upside of 6.6% for the stock. Since the company’s investors meeting on December 13, Morgan Stanley, Barclays, Stifel, JPMorgan Chase, BMO, Wells Fargo, and RBC have all raised their price targets on its stock. On January 10, Morgan Stanley raised its price target from $64 to $70. Barclays raised its price target from $65 to $69 on December 19. ## Stock performance The downgrade appears to have negatively affected Starbucks stock. Today, it was trading down ~2.7% in premarket trading hours. Since the beginning of 2019, it’s fallen 0.3% as of its January 10 closing price. During the same period, its peers McDonald’s (MCD) and Dunkin’ Brands (DNKN) have returned 2.2% and 9.5%, respectively. The broader comparative index, the Consumer Discretionary Select Sector SPDR ETF (XLY), which invests ~7.5% of its holdings in restaurant and travel companies, has returned 5.5% year-to-date.
NEW YORK, Jan. 10, 2019 -- In new independent research reports released early this morning, Market Source Research released its latest key findings for all current investors,.
Dunkin' is giving guests a great way to start 2019 with great value choices, offering its popular Dunkin' Go2s value menu to bring customers the chance to choose from three of the brand's popular breakfast menu items priced at $2, $4 and $5 for two of their go-to favorites. According to Tony Weisman, Chief Marketing Officer, Dunkin' U.S., "Offering favorite menu items at a great value is an important way Dunkin' stays such an integral part of our on-the-go guests' daily lives. To support Dunkin' Go2s, the brand has rolled out new advertising inspired by the rich, playful creativity, music and styles of the 1970s.
In the spirit of "new year, new you," Dunkin' is presenting an exciting new look to its product packaging, while welcoming both new and returning favorite menu items, to give the brand and its guests an energizing start to 2019. Last September, Dunkin' Donuts revealed plans to put the company on a first-name basis with America, in recognition of its long relationship with fans who have referred to the brand simply as "Dunkin'." As part of its rebranding efforts, in January Dunkin' will introduce bright and bold new product packaging that brings to life the energy and excitement of Dunkin's new brand identity.
CANTON, Mass., Jan. 3, 2019 /PRNewswire/ -- Baskin-Robbins, the world's largest chain of specialty ice cream shops, is ringing in 2019 with a brownie lover's dream come true. The January Flavor of the Month, Brownie Bar Mashup, is a delicious combination of traditional chocolate and blonde brownies. It delivers on two delicious brownie flavors in one bite.
Can Starbucks Maintain Its Upward Momentum in 2019? On average, analysts have set a 12-month price target of $68.64 on the stock, which represents a potential return of 8.8% from its current price of $63.08. Since Starbucks’s investor conference on December 13, during which the company outlined its long-term growth strategies, Barclays, JPMorgan Chase, Stifel, BMO, Wells Fargo, and RBC have raised their price targets on its stock.
Can Starbucks Maintain Its Upward Momentum in 2019? In fiscal 2018, Starbucks (SBUX) posted adjusted EPS of $2.42, a rise of 17.5% from $2.06 in fiscal 2017. Revenue growth, a lower effective tax rate, and share repurchases drove the company’s EPS during the period.
Can Starbucks Maintain Its Upward Momentum in 2019? In fiscal 2018, Starbucks (SBUX) posted an EBIT margin of 18.0% compared to 19.7% in fiscal 2017. Also, Starbucks’s licensing of its CPG and foodservice businesses to Nestlé contributed to the contraction in its EBIT margin in fiscal 2018.
Can Starbucks Maintain Its Upward Momentum in 2019? For fiscal 2019, analysts expect Starbucks (SBUX) to post revenue of $26.13 billion, a rise of 5.7% from $24.72 billion in fiscal 2018. For the same period, Starbucks’s management expects its consolidated revenue to rise 5%–7%, including a 2.0% fall from streamline-related activities.
Can Starbucks Maintain Its Upward Momentum in 2019? The net addition of 1,985 restaurants and global SSSG (same-store sales growth) of 2.0% drove the company’s revenue during the period. The net addition of 271 company-owned restaurants and 624 franchised restaurants along with positive SSSG of 2.0% drove the segment’s revenue during the period.
Despite weakness in the broader equity market, with the S&P 500 Index falling 7.7% in 2018, Starbucks (SBUX) has returned 9.8% YTD (year-to-date) as of December 26. Starbucks’s stock price has been driven by its strong fiscal 2018 fourth-quarter earnings, the announcement of the acquisition of a $900 million stake in the company by Bill Ackman’s Pershing Square Capital, and the optimism surrounding its management’s initiatives to drive its sales. In its fourth quarter, which ended on September 30, Starbucks outperformed analysts’ revenue and EPS expectations.
A Florida-based restaurant franchise veteran has purchased all 38 Rent-A-Center Inc. (Nasdaq: RCII) locations in Arizona. Tampa, Florida-based Purple Square Management Co. bought all the rent-to-own furniture, appliance and electronic company’s stores in Arizona. Part of the deal is that the new franchisee has to open five new Rent-A-Center stores in the state during the next few years.
Cracker Barrel's (CBRL) marketing efforts, enhanced focus on retail business and increased focus on menu innovation bode well.
The elite funds run by legendary investors such as Dan Loeb and David Tepper make hundreds of millions of dollars for themselves and their investors by spending enormous resources doing research on small cap stocks that big investment banks don’t follow. Because of their pay structures, they have strong incentive to do the research necessary […]
Darden's (DRI) efforts in improving the basic operating factors of the business such as food, service and atmosphere aid the fiscal second-quarter revenues to grow.