Starbucks Stock Eyes Worst Day Since 2020 After Earnings

Starbucks Corp (NASDAQ:SBUX) stock is down 14.7% to trade at $75.48 at last check, after the coffee chain announced a fiscal second-quarter earnings and revenue miss, and cut its 2024 profit and sales forecast. The company attributed the disappointing results to adverse weather in the U.S., economic volatility in the Middle East, and lower demand in China, but promised new drinks and deals to attract customers.

In response, Deutsche Bank downgraded SBUX to "hold" from "buy," and lowered its price objective to $89 from $108, while another 11 analysts slashed their price objectives as well. Still, 13 of 32 firms in question carry a "buy" or better rating, while the 12-month consensus target price of $95.34 is still a 27.8% premium to current levels. This means there is still room for additional bear notes.

Starbucks stock is trading at fresh 52-week lows, after facing rejection at the $90 level and the 40-day moving average, the latter of which has been capping price action since March. Shares are looking to snap a three-day win streak with their worst-single day percentage loss since March 2020, and are down 21.3% in 2024.

Options volume is today running at 12 times the intraday average volume, with 54,000 calls and 73,000 puts traded so far. The most active contract is the June 85 put, but positions are being opened at the weekly 5/3 80-strike call.