Can Starbucks' Solid Comps Growth Support Stronger FY26 Earnings?
Starbucks Corporation SBUX enters the final quarter of fiscal 2026 with stronger comparable sales and earnings trends. Global comparable sales rose 7.9% in the fiscal third quarter, while net revenues reached $9.3 billion. EPS increased 70% year over year to 85 cents. The improvement was supported by higher customer traffic and spending, giving the company a stronger base for earnings growth.
The U.S. business provides a key base for this growth. Comparable sales increased 7.9%, driven by a 4.2% rise in transactions and a 3.6% improvement in average ticket. Food attach reached a quarterly record across U.S. company-operated stores, while delivery and product modifications supported ticket growth. The balanced contribution from traffic and ticket growth gives the company a stronger foundation for earnings as comparable sales improve.
Starbucks’ stronger comparable sales also supported margin expansion. Consolidated operating margin expanded 430 basis points to 14.4%, while North America margin increased 280 basis points year over year. Sales leverage, operational improvements and cost savings helped offset investments in Green Apron Service and menu innovation. The company also reduced G&A expenses by about 20%, with the decline supported by cost savings, the China business deconsolidation and the comparison with higher leadership-related expenses in fiscal 2025.
Starbucks raised its fiscal 2026 expectations following the stronger performance. U.S. comparable sales are projected to grow a little more than 6%, while global comparable sales are expected to approach 6%. Consolidated operating margin guidance was raised to above 11%, and EPS guidance increased to $2.55-$2.65. Starbucks also expects coffee price pressure to ease in the fiscal fourth quarter, which could reduce a previous drag on margins.
The earnings trajectory will depend on whether Starbucks can maintain comparable sales growth while preserving the margin gains achieved in the third quarter. The company remains on track with its $2 billion cost-savings plan through fiscal 2028. Sales leverage and cost savings could support earnings as comparable sales grow. However, the company expects continued variability in the broader consumer environment, making traffic growth an important factor for fiscal fourth-quarter performance.
SBUX’s Price Performance, Valuation & Estimates
Shares of Starbucks have gained 18.5% in the past year against the industry’s 7.3% decline. In the same time frame, other industry players like Dutch Bros Inc. BROS and McDonald's Corporation MCD have declined 23% and 14.7%, respectively.
SBUX’s One-Year Price Performance
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From a valuation standpoint, SBUX trades at a forward price-to-sales (P/S) multiple of 3.06, below the industry’s average of 3.09. Conversely, industry players, such as Dutch Bros and McDonald's, have P/S multiples of 3.43 and 6.5, respectively.
SBUX’s P/S Ratio (Forward 12-Month) vs. Industry
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The Zacks Consensus Estimate for SBUX’s fiscal 2026 earnings per share has increased in the past 30 days.
EPS Trend of SBUX Stock
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The company is likely to report strong earnings, with projections indicating a 21.1% rise in fiscal 2026. Conversely, industry players like McDonald's are likely to witness an increase of 5.6%, year over year, in 2026 earnings. Meanwhile, Dutch Bros’ 2026 earnings are likely to witness a rise of 27.6% year over year.
SBUX currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
