Shares of coffee giant
) reached a new 52-week high of $60.92 on Monday, Apr 29,
following strong earnings results for the second quarter of
fiscal 2013. Starbucks also upped its earnings guidance for
fiscal 2013, while retaining its sales, comps and operating
The closing price of the coffee maker on Apr 29 was $60.58,
representing a solid 1-year return of about 5.6% and year-to-date
return of about 10.2%. Average volume of shares traded over the
last three months stands at approximately 5180K.
During the second quarter of fiscal 2013, earnings soared 20%
year over year to 48 cents on the back of solid margin
Total sales for the second quarter increased 11% year over
year to $3.56 billion but slightly missed the Zacks Consensus
Estimate of $3.59 billion. Beverage and food innovations and the
steady sales growth in the U.S. and Asia were partially offset by
the weakness in Europe.
Same-store sales, which exclude the impact of new
company-operated stores opened in the past 13 months, grew 6%,
same as in the first quarter of fiscal 2013.
Adjusted operating margin increased 180 basis points (bps) to
15.3% driven by strong sales leverage and lower coffee costs.
Cost controls and improved efficiency in the retail stores also
The company upped its earnings guidance for 2013 but
maintained its sales, comps and operating margin outlook.
Earnings expectations were upgraded from a range of $2.06 - $2.15
to $2.12 - $2.18 (including the second-quarter one-time gain from
sale of minority equity stake in a joint venture in Mexico).
Starbucks carries a Zacks Rank #2 (Buy). The company has
compelling growth drivers, like La Boulange bakery products,
Verismo at-home-coffee machine, Evolution Fresh juices, Teavana
tea and K-Cups portion packs, to sustain the earnings momentum in
the upcoming quarters.
Green Mountain Coffee Roasters Inc.
), which carries a Zacks Rank #1 (Strong Buy), is another stock
worth considering in this space.
BURGER KING WWD (BKW): Free Stock Analysis
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GREEN MTN COFFE (GMCR): Free Stock Analysis
STARBUCKS CORP (SBUX): Free Stock Analysis
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