Highlights

  • BMO Capital Markets and Wells Fargo lowered Starbucks price targets to USD 100.
  • Wall Street Zen downgraded Starbucks from "hold" to "sell" in late May.
  • Analysts forecast Starbucks to post 2.99 EPS for the current fiscal year.

Starbucks Corporation (NASDAQ: SBUX) has seen a series of rating adjustments by major brokerage firms following the company’s recent quarterly earnings report. The changes reflect varying perspectives on the company’s near-term growth prospects after earnings missed some expectations.

On April 30th, BMO Capital Markets reduced its price target for Starbucks from USD 115.00 to USD 100.00 while maintaining an "outperform" rating. Similarly, Wells Fargo & Company lowered its target price from USD 125.00 to USD 100.00 but kept an "overweight" rating as of April 22nd. These revisions signal a tempered outlook on the company’s stock valuation.

In contrast, Robert W. Baird reiterated a "neutral" rating with a lowered target price of USD 85.00 on April 7th, down from the previous USD 114.00 target. More recently, Wall Street Zen downgraded Starbucks from a "hold" rating to a "sell" rating on May 22nd, while Cowen shifted its rating from "buy" to "hold" on May 29th.

Overall, the consensus among analysts remains cautious. According to data, Starbucks holds an average rating of "Hold" with a consensus price target of USD 98.96. The distribution of ratings shows a broad range: 3 sell ratings, 12 hold ratings, and 14 buy ratings.

Starbucks reported its quarterly earnings on April 29th, posting earnings per share (EPS) of USD 0.41, missing the consensus estimate of USD 0.51 by USD 0.10. Revenue came in at USD 8.76 billion, slightly below analyst expectations of USD 8.90 billion. The company’s revenue showed a 2.3% increase compared to the same quarter last year. However, Starbucks posted a negative return on equity of 42.14%, while maintaining a net margin of 8.61%. In the prior year’s comparable quarter, the company earned USD 0.68 EPS.

Looking ahead, analyst forecasts predict Starbucks will generate EPS of 2.99 for the full fiscal year. These mixed signals underline ongoing uncertainty about the company’s ability to regain its prior momentum amid changing market conditions.

Investors and observers will likely continue to monitor broker updates and earnings reports closely as the fiscal year progresses.