The 10-second takeaway
For the quarter ended March 31 (Q2), Starbucks met expectations on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue increased. Non-GAAP earnings per share expanded significantly. GAAP earnings per share grew significantly.
Margins grew across the board.
Starbucks logged revenue of $3.56 billion. The 27 analysts polled by S&P Capital IQ wanted to see revenue of $3.58 billion on the same basis. GAAP reported sales were 11% higher than the prior-year quarter's $3.20 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.48. The 29 earnings estimates compiled by S&P Capital IQ anticipated $0.48 per share. Non-GAAP EPS of $0.48 for Q2 were 20% higher than the prior-year quarter's $0.40 per share. GAAP EPS of $0.51 for Q2 were 28% higher than the prior-year quarter's $0.40 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 57.0%, 120 basis points better than the prior-year quarter. Operating margin was 13.8%, 190 basis points better than the prior-year quarter. Net margin was 11.0%, 130 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $3.72 billion. On the bottom line, the average EPS estimate is $0.54.
Next year's average estimate for revenue is $14.90 billion. The average EPS estimate is $2.17.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 6,699 members out of 8,329 rating the stock outperform, and 1,630 members rating it underperform. Among 2,310 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 2,125 give Starbucks a green thumbs-up, and 185 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Starbucks is outperform, with an average price target of $63.15.
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