Starbucks: What to Look for in Q3 Report
Starbucks (NASDAQ: SBUX) is a Seattle, Washington based American global coffee company and the largest coffeehouse chain in the world.
Starbucks is set to release its fourth quarter report and fiscal year end 2014 financial results on Thursday, October 30th after market close. Analysts’ are expecting the coffeehouse chain to report $0.74 earnings per share, representing a 23.5% year-over-year growth and $4.23 billion in revenue, up 11.6% on a year-over-year basis.
Last quarter, Starbucks delivered positive earnings of 1.52%. In fact, the coffeehouse chain has been increasingly gaining momentum over the last several years with numerous new locations and revenues reaching $16.1 billion in the last four quarters. That is a 63% increase from five years ago. In addition, the coffeehouse chain has posted a same-store sales growth of 5% for the past 18 consecutive quarters. The company’s financials are currently in good shape with a debt/equity ratio of 0.40 and a ratio of 1.20.
Starbucks is expected to comment on the recent price hike in coffee prices and how it will affect margins coming into 2015. In addition, investors and analysts alike are looking to see how the introduction of Fizzio handcrafted sodas fared since entering the market this past June. A number of Starbucks Baristas have said that the handcrafted carbonated beverage has not been very popular, thus potentially causing the company to fall short on expectations.
Starbucks is also expected to give an update on Apple Pay as mobile payments currently represent over 15% of U.S. transactions in company-owned stores. Starbucks is scheduled to start accepting Apple Pay by the end of this year.
Starbucks is set to report 4Q14 and FY2014 results on Thursday after market in a conference call that will be held at 5PM EST. Will the coffeehouse chain come out on top, or will investors come out disappointed?
On average, the current top analyst consensus for Starbucks is Moderate Buy.