2024-04-03 03:45:00 ET
Because it lowered its estimated sales growth range for 2024 from 10%-12% down to 7%-10%, Starbucks (NASDAQ: SBUX) disappointed the market with its recent first-quarter results. This downward revision -- paired with the company's slowing growth rates in recent quarters -- helps explain why Starbucks' stock price currently sits 29% below its all-time highs.
Management didn't revise its earnings-per-share (EPS) guidance of 15%-20% growth in 2024. Leaving these expectations intact, Starbucks looks like a value, according to Wells Fargo analyst Zachary Fadem, whose price target of $105 implies a 17.5% upside over the next 12 months.
Fadem thinks the discounted share price already reflects any upcoming Q2 dissatisfaction and predicts a rebound for Starbucks' stock. Considering its market-beating indicators, Starbucks could prove to be a buy at today's prices.
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Starbucks Stock Has 17% Upside, According to 1 Wall Street Analyst