In the latest trading session, Starbucks (SBUX) closed at $58.06, marking a -1.28% move from the previous day. This change was narrower than the S&P 500's 3.09% loss on the day. Elsewhere, the Dow lost 2.41%, while the tech-heavy Nasdaq lost 4.43%.
Coming into today, shares of the coffee chain had gained 3.36% in the past month. In that same time, the Retail-Wholesale sector lost 9.63%, while the S&P 500 lost 6.27%.
Wall Street will be looking for positivity from SBUX as it approaches its next earnings report date. This is expected to be November 1, 2018. The company is expected to report EPS of $0.59, up 7.27% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $6.20 billion, up 8.77% from the year-ago period.
It is also important to note the recent changes to analyst estimates for SBUX. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.07% higher within the past month. SBUX is currently a Zacks Rank #3 (Hold).
Digging into valuation, SBUX currently has a Forward P/E ratio of 22.41. This valuation marks a discount compared to its industry's average Forward P/E of 22.66.
Meanwhile, SBUX's PEG ratio is currently 1.6. 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 1.85 as of yesterday's close.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 101, putting it in the top 40% 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.
Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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