Royal Bank Of Canada Forecasts Strong Price Appreciation for Starbucks (NASDAQ:SBUX) Stock

Key Points

• Royal Bank of Canada has increased its price target for Starbucks from $100.00 to $110.00, indicating a potential upside of 14.65% from the current stock price and maintaining an "outperform" rating.
• Starbucks recently reported quarterly earnings of $0.50 EPS, missing estimates of $0.64, with revenues of $9.46 billion, surpassing expectations.
• The stock currently holds an average rating of "Hold" from analysts, with a consensus price target of $99.15, while the company faces mixed ratings from various research firms.

Starbucks (NASDAQ:SBUX - Free Report) had its price objective boosted by Royal Bank Of Canada from $100.00 to $110.00 in a research note published on Wednesday morning, MarketBeat reports. They currently have an outperform rating on the coffee company's stock.

A number of other research analysts have also recently commented on the company. Cowen reaffirmed a "hold" rating on shares of Starbucks in a research report on Tuesday, June 24th. UBS Group reaffirmed a "neutral" rating on shares of Starbucks in a research report on Monday, July 21st. JPMorgan Chase & Co. dropped their price target on Starbucks from $105.00 to $100.00 and set an "overweight" rating on the stock in a research report on Wednesday, April 30th. Guggenheim dropped their price target on Starbucks from $95.00 to $83.00 and set a "neutral" rating on the stock in a research report on Tuesday, April 29th. Finally, Sanford C. Bernstein upped their price target on Starbucks from $90.00 to $100.00 and gave the company an "outperform" rating in a research report on Wednesday, July 2nd. Four analysts have rated the stock with a sell rating, eleven have given a hold rating and fifteen have given a buy rating to the company. Based on data from MarketBeat.com, Starbucks currently has a consensus rating of "Hold" and a consensus price target of $101.27.

Starbucks Stock Down 3.4%

SBUX stock traded down $3.00 during midday trading on Wednesday, hitting $86.16. The company's stock had a trading volume of 3,852,098 shares, compared to its average volume of 10,588,565. The stock's 50-day moving average price is $91.68 and its 200 day moving average price is $94.62. Starbucks has a 1 year low of $72.72 and a 1 year high of $117.46. The stock has a market cap of $97.91 billion, a price-to-earnings ratio of 37.19, a PEG ratio of 6.54 and a beta of 1.02.

Starbucks (NASDAQ:SBUX - Get Free Report) last posted its quarterly earnings data on Tuesday, July 29th. The coffee company reported $0.50 earnings per share for the quarter, missing the consensus estimate of $0.64 by ($0.14). Starbucks had a negative return on equity of 36.23% and a net margin of 7.18%. The business had revenue of $9.46 billion during the quarter, compared to analysts' expectations of $9.29 billion. During the same period in the prior year, the firm posted $0.93 EPS. The firm's revenue for the quarter was up 3.8% on a year-over-year basis. As a group, equities analysts forecast that Starbucks will post 2.99 earnings per share for the current fiscal year.

Starbucks Announces Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Friday, August 29th. Stockholders of record on Friday, August 15th will be given a dividend of $0.61 per share. The ex-dividend date is Friday, August 15th. This represents a $2.44 annualized dividend and a dividend yield of 2.8%. Starbucks's dividend payout ratio is 105.17%.

Hedge Funds Weigh In On Starbucks

Several institutional investors have recently modified their holdings of the company. Game Plan Financial Advisors LLC purchased a new stake in Starbucks during the 2nd quarter valued at about $25,000. University of Texas Texas AM Investment Management Co. purchased a new stake in Starbucks during the 4th quarter valued at about $25,000. Hughes Financial Services LLC purchased a new stake in Starbucks during the 1st quarter valued at about $27,000. Chelsea Counsel Co. purchased a new stake in Starbucks during the 2nd quarter valued at about $26,000. Finally, CBIZ Investment Advisory Services LLC boosted its holdings in Starbucks by 125.2% during the 1st quarter. CBIZ Investment Advisory Services LLC now owns 286 shares of the coffee company's stock valued at $28,000 after acquiring an additional 159 shares during the period. 72.29% of the stock is currently owned by institutional investors.

About Starbucks

Starbucks Corporation, together with its subsidiaries, operates as a roaster, marketer, and retailer of coffee worldwide. The company operates through three segments: North America, International, and Channel Development. Its stores offer coffee and tea beverages, roasted whole beans and ground coffees, single serve products, and ready-to-drink beverages; and various food products, such as pastries, breakfast sandwiches, and lunch items.