Starbucks Reaches 52-Week High - Analyst Blog
April 30 2013 - 2:45PM
Zacks
Shares of coffee giant Starbucks Corp. (SBUX)
reached a new 52-week high of $60.92 on Monday, Apr 29, following
strong earnings results for the second quarter of fiscal 2013.
Starbucks also upped its earnings guidance for fiscal 2013, while
retaining its sales, comps and operating margin outlook.
The closing price of the coffee maker on Apr 29 was $60.58,
representing a solid 1-year return of about 5.6% and year-to-date
return of about 10.2%. Average volume of shares traded over the
last three months stands at approximately 5180K.
Growth Drivers
During the second quarter of fiscal 2013, earnings soared 20%
year over year to 48 cents on the back of solid margin growth.
Total sales for the second quarter increased 11% year over year
to $3.56 billion but slightly missed the Zacks Consensus Estimate
of $3.59 billion. Beverage and food innovations and the steady
sales growth in the U.S. and Asia were partially offset by the
weakness in Europe.
Same-store sales, which exclude the impact of new
company-operated stores opened in the past 13 months, grew 6%, same
as in the first quarter of fiscal 2013.
Adjusted operating margin increased 180 basis points (bps) to
15.3% driven by strong sales leverage and lower coffee costs. Cost
controls and improved efficiency in the retail stores also boosted
margins.
The company upped its earnings guidance for 2013 but maintained
its sales, comps and operating margin outlook. Earnings
expectations were upgraded from a range of $2.06 - $2.15 to $2.12 -
$2.18 (including the second-quarter one-time gain from sale of
minority equity stake in a joint venture in Mexico).
Starbucks carries a Zacks Rank #2 (Buy). The company has
compelling growth drivers, like La Boulange bakery products,
Verismo at-home-coffee machine, Evolution Fresh juices, Teavana tea
and K-Cups portion packs, to sustain the earnings momentum in the
upcoming quarters.
Green Mountain Coffee Roasters Inc. (GMCR),
which carries a Zacks Rank #1 (Strong Buy), is another stock worth
considering in this space.
BURGER KING WWD (BKW): Free Stock Analysis Report
CRACKER BARREL (CBRL): Free Stock Analysis Report
GREEN MTN COFFE (GMCR): Free Stock Analysis Report
STARBUCKS CORP (SBUX): Free Stock Analysis Report
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