Starbucks (NASDAQ:SBUX) Sets New 12-Month High - Should You Buy?

Key Points

• Starbucks hit a new 52-week high, trading as high as $110.57. Analyst sentiment was mixed, with a consensus “Hold” rating and an average price target of $108.74.
• Quarterly EPS of $0.80 beat estimates of $0.72, but revenue of $9.14 billion fell short of forecasts and declined 4.5% year over year.
• The company raised its quarterly dividend from $0.62 to $0.63 per share, equivalent to an annualized yield of about 2.3%.

Shares of Starbucks Corporation (NASDAQ:SBUX - Get Free Report) hit a new 52-week high during trading on Thursday. The company traded as high as $110.57 and last traded at $110.4240, with a volume of 52,530 shares trading hands. The stock had previously closed at $109.70.

Analyst Ratings Changes

A number of analysts recently weighed in on SBUX shares. KeyCorp reaffirmed a "sector weight" rating on shares of Starbucks in a research report on Friday, October 30th. Bank of America reissued a "buy" rating on shares of Starbucks in a research report on Monday. Rothschild & Co Redburn boosted their price objective on Starbucks from $81.00 to $82.00 and gave the stock a "sell" rating in a research note on Wednesday, September 30th. Melius Research set a $110.00 target price on Starbucks in a research report on Monday, August 3rd. Finally, Guggenheim reiterated a "neutral" rating and issued a $103.00 target price (up from $97.00) on shares of Starbucks in a research note on Monday. Twenty-one investment analysts have rated the stock with a Buy rating, fifteen have assigned a Hold rating and four have issued a Sell rating to the company. According to MarketBeat.com, Starbucks has a consensus rating of "Hold" and an average target price of $108.74.

Starbucks Trading Up 0.4%

The stock has a market cap of $125.54 billion, a PE ratio of 50.13, a P/E/G ratio of 1.73 and a beta of 1.01. The company's 50 day moving average is $99.23 and its 200-day moving average is $99.92.

Starbucks (NASDAQ:SBUX - Get Free Report) last posted its quarterly earnings data on Thursday, October 29th. The coffee company reported $0.80 earnings per share for the quarter, beating analysts' consensus estimates of $0.72 by $0.08. The company had revenue of $9.14 billion during the quarter, compared to analysts' expectations of $9.22 billion. Starbucks had a net margin of 6.66% and a negative return on equity of 38.61%. The firm's revenue for the quarter was down 4.5% on a year-over-year basis. During the same period in the prior year, the company posted $0.52 EPS. As a group, analysts forecast that Starbucks Corporation will post 3.22 EPS for the current year.

Starbucks Increases Dividend

The business also recently declared a quarterly dividend, which will be paid on Friday, November 27th. Investors of record on Friday, November 13th will be paid a $0.63 dividend. This represents a $2.52 dividend on an annualized basis and a dividend yield of 2.3%. This is a boost from Starbucks's previous quarterly dividend of $0.62. The ex-dividend date is Friday, November 13th. Starbucks's payout ratio is presently 112.22%.

Insider Transactions at Starbucks

In other Starbucks news, CEO Brady Brewer sold 588 shares of the stock in a transaction on Tuesday, October 20th. The shares were sold at an average price of $100.00, for a total transaction of $58,800.00. Following the transaction, the chief executive officer directly owned 70,920 shares in the company, valued at $7,092,000. This represents a 0.82% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 4,458 shares of company stock valued at $449,684 over the last 90 days. Corporate insiders own 0.03% of the company's stock.

Institutional Investors Weigh In On Starbucks

Hedge funds and other institutional investors have recently modified their holdings of the stock. Sunbelt Securities Inc. raised its stake in Starbucks by 1.0% in the first quarter. Sunbelt Securities Inc. now owns 9,473 shares of the coffee company's stock valued at $849,000 after purchasing an additional 97 shares in the last quarter. Cypress Capital Management LLC WY increased its holdings in shares of Starbucks by 30.9% during the second quarter. Cypress Capital Management LLC WY now owns 424 shares of the coffee company's stock worth $43,000 after buying an additional 100 shares in the last quarter. Webster Bank N. A. raised its holdings in Starbucks by 7.8% in the 2nd quarter. Webster Bank N. A. now owns 1,396 shares of the coffee company's stock valued at $143,000 after buying an additional 101 shares during the last quarter. Nilsine Partners LLC lifted its holdings in shares of Starbucks by 1.0% during the second quarter. Nilsine Partners LLC now owns 10,039 shares of the coffee company's stock worth $1,026,000 after purchasing an additional 101 shares during the period. Finally, Beta Wealth Group Inc. grew its position in shares of Starbucks by 1.7% in the 2nd quarter. Beta Wealth Group Inc. now owns 6,216 shares of the coffee company's stock valued at $635,000 after buying an additional 102 shares during the last quarter. Institutional investors own 72.29% of the company's stock.

Starbucks Company Profile

Starbucks Corporation is a global specialty coffee company headquartered in Seattle, Washington. Founded in 1971, the company operates and licenses coffeehouses under the Starbucks brand, serving brewed coffee, espresso beverages, teas, cold drinks, food, and other ready-to-consume products.

In addition to its company-operated and licensed stores, Starbucks sells packaged coffee, tea, and single-serve products through grocery retailers, convenience stores, and other distribution channels.

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