In the latest market close, Starbucks (SBUX) reached $72.56, with a -0.26% movement compared to the previous day. This change lagged the S&P 500’s daily gain of 1.02%. Meanwhile, the Dow gained 1.09%, and the Nasdaq, a tech-heavy index, added 1.18%.

Shares of the coffee chain witnessed a loss of 8.94% over the previous month, trailing the performance of the Retail-Wholesale sector with its gain of 1.87% and the S&P 500’s gain of 4.44%.

Market participants will be closely following the financial results of Starbucks in its upcoming release. In that report, analysts expect Starbucks to post earnings of $0.94 per share. This would mark a year-over-year decline of 6%. Meanwhile, the latest consensus estimate predicts the revenue to be $9.25 billion, indicating a 0.91% increase compared to the same quarter of the previous year.

For the full year, the Zacks Consensus Estimates project earnings of $3.58 per share and a revenue of $36.83 billion, demonstrating changes of +1.13% and +2.37%, respectively, from the preceding year.

Investors should also pay attention to any latest changes in analyst estimates for Starbucks. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts’ favorable outlook on the company’s business health and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To exploit this, we’ve formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.26% lower. Starbucks is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, Starbucks is currently trading at a Forward P/E ratio of 20.3. This represents a premium compared to its industry’s average Forward P/E of 18.8.

We can additionally observe that SBUX currently boasts a PEG ratio of 1.59. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. As the market closed yesterday, the Retail – Restaurants industry was having an average PEG ratio of 1.75.

The Retail – Restaurants industry is part of the Retail-Wholesale sector. With its current Zacks Industry Rank of 101, this industry ranks in the top 41% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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