Starbucks (NASDAQ:SBUX) Shares Gap Down Following Weak Earnings

Starbucks Co. (NASDAQ:SBUX - Get Free Report) shares gapped down prior to trading on Wednesday following a weaker than expected earnings announcement. The stock had previously closed at $84.85, but opened at $76.37. Starbucks shares last traded at $78.86, with a volume of 8,880,295 shares trading hands.

The coffee company reported $0.41 EPS for the quarter, missing analysts' consensus estimates of $0.51 by ($0.10). The firm had revenue of $8.76 billion during the quarter, compared to the consensus estimate of $8.90 billion. Starbucks had a net margin of 9.73% and a negative return on equity of 44.97%. The business's revenue for the quarter was up 2.3% on a year-over-year basis. During the same quarter last year, the firm earned $0.68 earnings per share.

Starbucks Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Friday, May 30th. Stockholders of record on Friday, May 16th will be issued a $0.61 dividend. The ex-dividend date of this dividend is Friday, May 16th. This represents a $2.44 dividend on an annualized basis and a dividend yield of 3.12%. Starbucks's dividend payout ratio (DPR) is presently 78.71%.

Wall Street Analysts Forecast Growth

SBUX has been the subject of several recent research reports. Argus raised Starbucks from a "hold" rating to a "buy" rating and set a $115.00 price target for the company in a research report on Tuesday, March 18th. Wedbush boosted their target price on shares of Starbucks from $95.00 to $100.00 and gave the stock a "neutral" rating in a report on Wednesday, January 29th. Robert W. Baird reiterated a "neutral" rating and issued a $85.00 price target (down previously from $114.00) on shares of Starbucks in a research note on Monday, April 7th. The Goldman Sachs Group lowered shares of Starbucks from a "buy" rating to a "neutral" rating and set a $85.00 price objective on the stock. in a research note on Wednesday. Finally, UBS Group reduced their price target on Starbucks from $105.00 to $90.00 and set a "neutral" rating for the company in a report on Monday. Two research analysts have rated the stock with a sell rating, eleven have assigned a hold rating and sixteen have assigned a buy rating to the stock. Based on data from MarketBeat.com, Starbucks presently has an average rating of "Hold" and an average price target of $100.58.

Institutional Investors Weigh In On Starbucks

Institutional investors have recently added to or reduced their stakes in the business. Financial Life Planners bought a new position in shares of Starbucks in the fourth quarter worth $25,000. University of Texas Texas AM Investment Management Co. bought a new position in Starbucks in the 4th quarter worth about $25,000. Graney & King LLC purchased a new position in Starbucks during the 4th quarter valued at about $26,000. Collier Financial bought a new stake in shares of Starbucks during the fourth quarter valued at about $27,000. Finally, Runnymede Capital Advisors Inc. purchased a new stake in Starbucks in the 4th quarter worth approximately $27,000. 72.29% of the stock is owned by hedge funds and other institutional investors.

Starbucks Price Performance

The stock has a market cap of $88.82 billion, a P/E ratio of 25.13, a PEG ratio of 3.59 and a beta of 1.00. The firm's fifty day moving average price is $95.08 and its two-hundred day moving average price is $97.66.

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.

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