Starbucks (SBUX) Reports Q1: Everything You Need To Know Ahead Of Earnings

Adam Hejl /
2024/01/29 2:01 am EST

Coffeehouse chain Starbucks (NASDAQ:SBUX) will be announcing earnings results tomorrow after market hours. Here's what to look for.

Last quarter Starbucks reported revenues of $9.37 billion, up 11.4% year on year, beating analyst revenue expectations by 1%. It was a decent quarter for the company, with revenue exceeding expectations this quarter based on higher-than-expected same store sales. Its EPS also narrowly outperformed Wall Street's estimates

Is Starbucks buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Starbucks's revenue to grow 10.6% year on year to $9.64 billion, improving on the 8.2% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.94 per share.

Starbucks Total Revenue

The analysts covering the company have been growing increasingly bearish about the business heading into the earnings, with revenue estimates seeing fourteen downward revisions over the last thirty days.The company missed Wall St's revenue estimates twice over the last two years.

Looking at Starbucks's peers in the restaurants segment, some of them have already reported Q1 earnings results, giving us a hint of what we can expect. Darden delivered top-line growth of 9.7% year on year, missing analyst estimates by 0.5% and Kura Sushi reported revenues up 30.9% year on year, exceeding estimates by 0.1%. Darden traded flat on the results, Kura Sushi was down 4.6%.

Read our full analysis of Darden's results here and Kura Sushi's results here.

Investors in the restaurants segment have had steady hands going into the earnings, with the stocks down on average 1% over the last month. Starbucks is down 0.9% during the same time, and is heading into the earnings with analyst price target of $109.9, compared to share price of $92.8.

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The author has no position in any of the stocks mentioned.