What Does Wall Street See for Starbucks' Q3?

Seth Jayson, The Motley Fool
Updated

Starbucks (NAS: SBUX) is expected to report Q3 earnings on July 26. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict Starbucks' revenues will grow 13.9% and EPS will grow 25.0%.

The average estimate for revenue is $3.34 billion. On the bottom line, the average EPS estimate is $0.45.


Revenue details
Last quarter, Starbucks booked revenue of $3.20 billion. GAAP reported sales were 15% higher than the prior-year quarter's $2.79 billion.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, EPS came in at $0.40. GAAP EPS of $0.40 for Q2 were 18% higher than the prior-year quarter's $0.34 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 55.8%, 220 basis points worse than the prior-year quarter. Operating margin was 11.9%, 50 basis points worse than the prior-year quarter. Net margin was 9.7%, 30 basis points better than the prior-year quarter.

Looking ahead
The full year's average estimate for revenue is $13.51 billion. The average EPS estimate is $1.83.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 6,178 members out of 7,818 rating the stock outperform, and 1,640 members rating it underperform. Among 2,175 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,943 give Starbucks a green thumbs-up, and 232 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Starbucks is outperform, with an average price target of $56.96.

The article What Does Wall Street See for Starbucks' Q3? originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Starbucks. Motley Fool newsletter services have recommended buying shares of Starbucks. Motley Fool newsletter services have recommended writing covered calls on Starbucks. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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