In the latest trading session, Starbucks (SBUX) closed at $74.96, marking a +1.08% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.84%. Meanwhile, the Dow gained 0.03%, and the Nasdaq, a tech-heavy index, added 2.51%.
Prior to today's trading, shares of the coffee chain had lost 2.82% over the past month. This has lagged the Retail-Wholesale sector's gain of 7.53% and the S&P 500's gain of 3.73% in that time.
SBUX will be looking to display strength as it nears its next earnings release, which is expected to be July 28, 2020. On that day, SBUX is projected to report earnings of -$0.60 per share, which would represent a year-over-year decline of 176.92%. Meanwhile, our latest consensus estimate is calling for revenue of $4.13 billion, down 39.52% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $0.80 per share and revenue of $23.14 billion, which would represent changes of -71.73% and -12.69%, respectively, from the prior year.
Investors might also notice 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.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.75% higher. SBUX currently has a Zacks Rank of #4 (Sell).
Investors should also note SBUX's current valuation metrics, including its Forward P/E ratio of 92.21. This valuation marks a premium compared to its industry's average Forward P/E of 42.17.
Meanwhile, SBUX's PEG ratio is currently 6.71. 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. SBUX's industry had an average PEG ratio of 4.96 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 65, which puts it in the top 26% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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Starbucks Corporation (SBUX): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.