Starbucks spikes after beating on sales and profits (SBUX)
- Starbucks reported fourth-quarter results that beat on both the top and bottom lines.
- Same-store-sales growth was at the high end of the estimated range.
- Shares soared 7% after Thursday's closing bell.
- Watch Starbucks trade in real time here.
Starbucks reported strong fourth-quarter results after Thursday's closing bell, sending shares up 7%.
Here are the key numbers compared to Bloomberg estimates:
- Earnings per share: $0.62 versus an expected $0.60
- Revenue: $6.3 billion versus an expected $6.27 billion
- Q4 Comparable Store Sales: +3% versus an expected +2.2%
"Starbucks record Q4 performance reflected meaningful improvement in virtually every critical operating metric compared to Q3," said CEO Kevin Johnson in the press release.
"As we enter fiscal 2019, we are executing against a clear growth agenda, with a focus on our long-term growth markets of the U.S. and China. We are also excited about the long-term growth potential of our new Global Coffee Alliance with Nestlé."
Shares faced a huge selloff in June when the company lowered its third-quarter same-store-sales growth forecast to 1% from its previous estimate of 3%-5%. The coffee giant also said it would close roughly 150 underperforming US stores.
Ahead of the results, UBS analyst Dennis Geiger said the focus for Starbucks' earnings will be the company's performance in the US and China markets, as well as its guidance.
"Primary focus for earnings on November 1 will be whether US/Americas comparable sales returned to 3% and if the momentum is sustainable," Geiger said in a note sent out to clients on Wednesday. "We model 3% F4Q Americas same-store sales, including 3% ticket and flat traffic."
He added: "For China, we don't believe same-store sales are as bad as feared(worse than F3Q's -2%) and we think FY19 expectations are low."
Geiger has a "buy" rating and a $62 price target on Starbucks — 5% above where shares were trading on Thursday.
Starbucks was up 2% this year.
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