Starbucks Plan Acceptance Likely Outweighs Its Earnings (SBUX)

By Douglas A. McIntyre Updated Apr 3, 2:01PM EDT · Published Jan 30, 12:32PM EST

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Starbucks Corp. (NASDAQ: SBUX) is set to report earnings today after the close of trading. First Call has estimates pegged at $0.27 EPS and $2.77 billion in revenues. Next quarter’s estimates are $0.22 EPS and $2.65 billion in revenues; if the company offers these targets, next year’s estimates for 2009 are $1.21 EPS and $12.66 billion in revenues. As of last look analysts have a price target average of $27.92. We recently came up with our own analysis for a fair value range, although our targets are much more conservative than those of Wall Street on Starbucks with a low-target calculation of $18 and $26 as a high-end target..

As of late morning after shares slid from being positive, it appears that options traders are looking for a move of up to $0.95 to $1.05 in either direction. The only good news about the chart is that at least this one stabilized after hitting $18-ish levels before Schultz announced he would resume the helm. Shares have traded in a $17.66 to $45.42 trading range over the last 52-weeks.

As estimates have been coming down, there are not near as many positives going in and it would be hard to imagine Wall Street demanding a solid quarter with bang up numbers. Schultz has already made some announcements on what he will do to bring the growth under control and to keep the wheels on the car, but you can imagine investors will be weighing the strategy more than a past number. Testing $1 coffee may be going the wrong way as it is "so early 1990’s.

Jon C. Ogg
January 30, 2008

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.