Shares of Starbucks Corp (NASDAQ:SBUX) were rising Thursday after the company reported upbeat fiscal third-quarter results.
Here are the key analyst takeaways:
- DA Davidson analyst Matt Curtis maintained a Neutral rating, while lifting the price target from $102 to $110.
- TD Cowen analyst Andrew Charles reiterated a Buy rating and price target of $120.
Check out other analyst stock ratings.
DA Davidson: Starbucks reported an earnings beat, driven by better-than-expected same-store sales and a tariff refund benefit, Curtis said in a note. The company’s consolidated global comps accelerated to 7.9%, from 6.2% in the previous quarter, and came in well above consensus estimates of 5%-6%, driven by 8.1% growth in North America and 5.7% growth internationally, he added.
Management raised their full-year guidance d across the board to reflect the fiscal third-quarter beat, the analyst stated, highlighting:
- Consolidated same-store sales to approach 6.0%, up from previous estimate of more than 5%.
- Consolidated operating margin of more than 11.0%, versus about 10% previously.
- Earnings of $2.55-$2.65 per share, up from prior projection of $2.25-$2.45.
While Starbucks has made impressive progress in its turnaround and earnings are expected to "rebound strongly" through fiscal 2028, its stock factor in a "significantly steeper improvement," he further wrote.
TD Cowen: Even after deducting the benefit from tariff refunds, Starbucks’ earnings were higher than expected, mainly due to upbeat North America same store sales, Charles said. "We are encouraged by better-than-expected F4Q SSS guidance," he wrote.
Management indicated that the sales success was driven by continued marketing efforts, menu innovation and speed of operations, fueled by the Green Apron labor model, the analyst stated. While the company reported a rise in active Starbucks Rewards to 35.8 million, from 35.6 million in the previous quarter, "Bloomberg data suggests that Starbucks has found more success driving traffic from returning customers than new customers," he noted.
SBUX Price Action: Shares of Starbucks had risen by 1.62% to $105.82 at the time of publication on Thursday.
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