Starbucks stock (SBUX) has been having a rough time this year, especially since it has only gained 0.38% year to date. There has only been two months of trading this year which means that the company’s stock still has a chance, but it will be a tough road ahead. Even looking at the one year-chart it doesn’t muster enough confidence. Over a one year period the stock has gained only 2.2%.
The company’s earnings have been mixed in nature, and traders remain cautious on the outlook. That is evidenced by the fact that the stock has been stagnant over the past year. A change of plans with the CEO resigning isn’t helping the stock either. Even on the face of the CEO Howard Schultz resigning his post this coming April. A new CEO will mean different strategies and that could have a negative effect on the stock.
Mixed Earnings
For its fiscal first quarter of 2017 Starbucks reported that it had earned $0.52 per share. This was in line with expectations, because analysts were expecting that the company would earn at least $0.52 per share. The company meeting expectations on the EPS number is somewhat of a good thing, but it wasn’t able to lift bullish sentiment. The EPS number coming in-line it wasn’t all that bad, but the problem lied with the revenue number that was reported.
The revenue number came in below expectations and that really hurt the stock. Starbucks reported that it had earned $5.73 billion in revenue, compared to analysts expecting it to earn $5.85 billion. The company blamed the mixed earnings report on a season where a lot of many other restaurant retailers were greatly challenged.
Same Store Sales
As noted before the stock had languished throughout most of 2016, with the stock only gaining 2.2% in a one year period. The main concern that traders had was that same store sales were not encouraging. This concern really put a strain on the stock, considering that it went nowhere throughout 2016. The Starbucks stock even managed to underperform the S&P 500 which managed to gain at least 12% in 2016. Even if you compare the year-to date-metric of the stock, it still doesn’t look to good. While the S&P 500 returned 2.76% year to date, Starbucks had only returned 0.38% in the same time period.
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