Starbucks (SBUX) Laps the Stock Market: Here's Why

Starbucks (SBUX) closed the most recent trading day at $87.11, moving +2.24% from the previous trading session. The stock exceeded the S&P 500, which registered a gain of 0.3% for the day. Meanwhile, the Dow experienced a rise of 0.86%, and the technology-dominated Nasdaq saw an increase of 0.17%. Shares of the coffee chain have appreciated by 7.04% over the course of the past month, outperforming the Retail-Wholesale sector's loss of 0.64%, and the S&P 500's loss of 0.06%.Market participants will be closely following the financial results of Starbucks in its upcoming release. In that report, analysts expect Starbucks to post earnings of $0.6 per share. This would mark a year-over-year decline of 13.04%. Meanwhile, our latest consensus estimate is calling for revenue of $9.64 billion, up 2.62% from the prior-year quarter. In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $2.4 per share and a revenue of $38.49 billion, indicating changes of +12.68% and +3.5%, respectively, from the former year. Investors might also notice recent changes to analyst estimates for Starbucks. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability. Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system. The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 3.76% lower. Right now, Starbucks possesses a Zacks Rank of #3 (Hold). Valuation is also important, so investors should note that Starbucks has a Forward P/E ratio of 35.56 right now. Its industry sports an average Forward P/E of 20.24, so one might conclude that Starbucks is trading at a premium comparatively. It is also worth noting that SBUX currently has a PEG ratio of 1.74. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As of the close of trade yesterday, the Retail - Restaurants industry held an average PEG ratio of 2.28. The Retail - Restaurants industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 188, putting it in the bottom 24% of all 250+ industries. The Zacks Industry Rank is ordered 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. Beyond Nvidia: AI's Second Wave Is HereThe AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. Little-known AI firms tackling the world's biggest problems may be more lucrative in the coming months and years.See "2nd Wave" AI stocks now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Starbucks Corporation (SBUX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks