/Starbucks%20Corp_%20logo%20by-%20eyewave%20via%20iStock.jpg)
Seattle, Washington-based Starbucks Corporation (SBUX) roasts, sells and distributes high-quality coffee globally. Valued at $104.6 billion by market cap, the company offers packaged and single-serve coffees and teas, beverage-related ingredients, and ready-to-drink beverages, as well as produces and sells bottled coffee drinks and a line of ice creams through over 40,000 stores worldwide under the brands Starbucks Coffee, Teavana, Seattle's Best Coffee, Ethos, and Starbucks Reserve. The coffee giant is expected to announce its fiscal first-quarter earnings for 2025 on Tuesday, Feb. 4.
Ahead of the event, analysts expect SBUX to report a profit of $0.66 per share on a diluted basis, down 26.7% from $0.90 per share in the year-ago quarter. The company beat or matched the consensus estimates in two of the last four quarters while missing the forecast on two other occasions.
For the full year, analysts expect SBUX to report EPS of $3.10, down 6.3% from $3.31 in fiscal 2024. However, its EPS is expected to rise 19.4% year over year to $3.70 in fiscal 2026.
SBUX stock has underperformed the S&P 500’s ($SPX) 21.8% gains over the past 52 weeks, with shares down 1.3% during this period. Similarly, it underperformed the Consumer Discretionary Select Sector SPDR Fund’s (XLY) 25.3% gains over the same time frame.
SBUX's underperformance is driven by decreasing consumer traffic, resulting in declining store sales in North America, internationally, and China. The company faces significant challenges, including loss of novelty and appeal, growing health concerns over sugary drinks, and heightened competition in saturated markets, along with rising marketing costs and macroeconomic challenges that are expected to persist and negatively impact earnings growth.
On Oct. 30, SBUX shares closed down marginally after reporting its Q4 results. Its adjusted EPS of $0.80 matched Wall Street expectations. The company’s revenue was $9.07 billion, exceeding Wall Street forecasts of $9.06 billion.
Analysts’ consensus opinion on SBUX stock is moderately bullish, with a “Moderate Buy” rating overall. Out of 29 analysts covering the stock, 16 advise a “Strong Buy” rating, two suggest a “Moderate Buy,” nine give a “Hold,” one advocates a “Moderate Sell,” and one recommends a “Strong Sell.” SBUX’s average analyst price target is $105, indicating a potential upside of 13.8% from the current levels.
