Starbucks Coffee (SBUX): Consumer Panel Confirms 5% SSS Leading to Below Consensus EPS - RBC

September 13, 2016 7:17 AM EDT
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Price: $58.00 +0.26%

Rating Summary:
    27 Buy, 9 Hold, 1 Sell

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    Up: 35 | Down: 31 | New: 11
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RBC Capital analyst, David Palmer, reiterated his Outperform rating on Starbucks (NASDAQ: SBUX) after his proprietary consumer panel confirmed his 5% SSS estimate for F4Q. This is in line with the company commentary that it would likely return to 5% SSS growth. The analyst believes this result would represent a two-year acceleration in sales and ease fears of an ongoing rapid deterioration in the business. Last quarter, Americas SSS growth slowed to 4% versus 7% SSS the quarter before.

The analyst's 2017 EPS estimate of $2.15 (+14% YOY; cons. $2.17) assumes ongoing partner wage investments and incorporates a 53-week year (2pp headwind) in FY16. No change to the price target of $68.

For an analyst ratings summary and ratings history on Starbucks click here. For more ratings news on Starbucks click here.

Shares of Starbucks closed at $54.71 yesterday.

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