Topic: How To Invest

Wall Street Stock Forecaster Hotline – Friday, September 6, 2019

Article Excerpt

STARBUCKS CORP., $95.74, Nasdaq symbol SBUX, is a leading seller and roaster of specialty coffee. It operates over 30,600 outlets in roughly 80 countries. The stock fell 2% this week after the company announced that it expects to earn between $2.80 and $2.82 a share for the 2019 fiscal year ending September 30, 2019. The midpoint—$2.81—is slightly below the consensus estimate of $2.82. For fiscal 2020, Starbucks expects its earnings per share will rise at a slower pace than its goal of achieving a 10% increase. That’s largely because the 2019 earnings benefitted from one-time tax breaks. The company also accelerated its share buyback plan, and repurchased $2 billion of its stock in 2019 instead of 2020. To put those repurchases in context, Starbucks’ market cap (the total value of all outstanding shares) is $114.6 billion. The stock has gained 68.0% since we first recommended it at $57 in our June 2018 issue. It now trades at 34.1 times its fiscal 2019 earnings…