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What To Expect From Starbucks’s (SBUX) Q4 Earnings

StockStory - Wed Nov 1, 2023

SBUX Cover Image

Coffeehouse chain Starbucks (NASDAQ:SBUX) will be reporting results tomorrow morning. Here's what to expect.

Last quarter Starbucks reported revenues of $9.17 billion, up 12.5% year on year, missing analyst expectations by 1.22%. It was a weak quarter for the company, with a miss of analysts' revenue estimates.

Is Starbucks buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Starbucks's revenue to grow 10.3% year on year to $9.28 billion, improving on the 3.28% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.97 per share.

Starbucks Total Revenue

The analysts covering the company have had mixed opinions about the business heading into the earnings, with revenue estimates seeing three upward and five downward revisions over the last thirty days. The company missed Wall St's revenue estimates three times over the last two years.

Looking at Starbucks's peers in the traditional fast food segment, some of them have already reported Q4 earnings results, giving us a hint of what we can expect. McDonald's delivered top-line growth of 14% year on year, beating analyst estimates by 2.16%, and Yum China reported revenues up 8.53% year on year, missing analyst estimates by 5.65%. McDonald's traded up 2.7% on the results, and Yum China was down 11.1%.

Read our full analysis of McDonald's's results here and Yum China's results here.

Investors in the traditional fast food segment have had steady hands going into the earnings, with the stocks up on average 1.5% over the last month. Starbucks is up 2.87% during the same time, and is heading into the earnings with analyst price target of $109, compared to share price of $92.1.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

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The author has no position in any of the stocks mentioned.

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