Analyst Assessment
Financial analysts are assessing Starbucks Corp’s upcoming earnings report, set for January 30 after market hours, to inform their investment recommendations. The company’s stock has declined over 10% in the past year, significantly impacted by inflationary pressures throughout 2023.
Technical Analysis
The 50-day Simple Moving Average (SMA) is approaching the 200-day SMA, but falls short of crossing over, a potential bullish signal for the stock. On-balance volume (OBV) has been declining since mid-November, signaling negative volume pressure and possible lower prices ahead.
Analyst Rating
Piper Sandler analyst Brian Mullan has assigned a Neutral rating to Starbucks, while reducing the price target from $107 to $100 per share. The assessment suggests a mixed sentiment surrounding the stock.
Outlook and Concerns
Mullan’s analysis indicates that while Starbucks may achieve its adjusted EPS guidance for fiscal 2024 due to cost-saving initiatives, there are concerns about same-store sales (SSS) and uncertainties in the US and China markets. He notes a lack of clarity on Starbucks’ China business and expresses reservations about its future SSS trends.
Market Dynamics
Mullan acknowledges positive risk-reward dynamics and relative value but emphasizes uncertainties around absolute upside potential, despite the stock trading at around 20x forward earnings. Starbucks’ stock was trading up 0.080% at $93.42 at the time of publication.