) is all set to unveil its fourth quarter and fiscal 2012 results
after market closes on November 1, 2012. The Zacks Consensus
Estimate for the fourth quarter is pegged at 45 cents (estimated
year-over-year growth of 21.03%) on revenues of $3.39 billion
(year-over-year increase of 11.9%). The fourth quarter estimate
is at the higher end of the company guidance range of 44 cents-45
For fiscal 2012, the Zacks Consensus Estimate is $1.78
(estimated year-over-year increase of 16.9%) on revenues of
$13.32 billion (year-over-year increase of 13.8%).
Third Quarter Recap
Starbucks reported earnings of 43 cents per share for fiscal
third quarter 2012, which missed both the Zacks Consensus
Estimate of 45 cents as well as the company expectations.
Starbucks was expecting to post earnings within a range of 44
cents - 45 cents in the quarter. The lower-than-expected results
were due to soft consumer traffic trends in the U.S. in June and
a weakening global consumer environment. Starbucks has also been
struggling in Europe for some time. Quarterly earnings however
increased 19% year over year due to top-line and margin
Total sales for the third quarter increased 13% year over year
to $3.3 billion. The sales growth was driven by strong global
same store sales and substantial top-line growth in the Channel
Development (also referred to as CPG business) segment. The
quarterly revenues were however almost in line with the Zacks
Consensus Estimate of $3.31 billion. Following the third quarter
miss, Starbucks cut its outlook for the fourth quarter due to the
Agreement of Estimate Revisions
Over the past 30 days, while 2 of 23 estimates for Starbucks's
fourth quarter earnings have been revised downward, one moved in
the opposite direction. For fiscal 2012, one out of 26 estimates
moved upward; as well as one estimate moved downward over the
past 30 days. For fiscal 2013, while 2 of 26 estimates moved up,
3 moved down. There have been no estimate revisions over the past
7 days for either the fourth quarter or for the fiscal 2012.
Most of the estimates were revised after the announcement of
guidance cut during the third quarter conference call in July
this year. Starbucks announced the launch of Verismo and opening
of its first store in India in the past quarter. However, these
news did not have any material impact on the estimates.
Magnitude of Estimate Revisions
The consensus estimates for the fourth quarter of 2012 as well
as for fiscal 2012 have remained static at 45 cents and $1.78
over the last 30 days. The fiscal 2013 consensus estimate stands
at $2.13, unchanged over the last 30 days and at the higher end
of the guidance range of $2.04 to $2.14.
Starbucks has surpassed earnings estimates in three of the
past four quarters, recording a maximum positive surprise of
2.78% in the fourth quarter of fiscal 2011. On average, the
earnings surprise is a positive 0.74%.
We currently have a Neutral recommendation on Starbucks. The
stock carries a Zacks #3 Rank (a short-term 'Hold' rating).
STARBUCKS CORP (SBUX): Free Stock Analysis
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