Starbucks (SBUX) is a roaster and retailer of specialty coffee globally. Besides its fresh, rich-brewed coffees, the company’s offerings include many complimentary food items and a selection of premium teas and other beverages, sold mainly through its retail stores.Analysts have taken their earnings expectations lower, landing the stock into an unfavorable Zacks Rank #5 (Strong Sell). Image Source: Zacks Investment ResearchIn addition, the company is in the Zacks Retail – Restaurants industry, which is currently ranked in the bottom 37% of all Zacks industries. Let’s take a closer look at how the company currently stacks up. StarbucksStarbucks shares have faced a rocky road year-to-date, down 23% compared to the S&P 500’s impressive 7.3% gain. As shown below, shares nosedived post-earnings following its latest release, with worse-than-expected results weighing heavily.
Image Source: Zacks Investment ResearchConcerning headline figures in its latest release, the company fell short of the Zacks Consensus EPS estimate by 14% and posted sales 6.3% below expectations. Both items were down from the year-ago period, with sales of $8.5 billion down 2%.Still, slowing business in China has remained a thorn in the company’s side, with China comparable store sales falling 11% on an 8% decline in average ticket. North American and U.S. comparable store sales also showed weakness, 3% lower, but saw a 4% increase in average ticket.Below is a chart illustrating the company’s revenue on a quarterly basis.
Image Source: Zacks Investment ResearchRachel Ruggeri, CFO, on the results: ‘“While it was a difficult quarter, we learned from our own underperformance and sharpened our focus with a comprehensive roadmap of well thought out actions making the path forward clear.” Bottom LineAnalysts’ negative revisions rolled in following the release of its latest quarterly results, with slowing sales becoming a thorn in the company’s side.Starbucks is a Zacks Rank #5 (Strong Sell), indicating that analysts have taken a bearish stance on the company’s earnings outlook.For those seeking strong stocks, a great idea would be to focus on stocks carrying a Zacks Rank #1 (Strong Buy) or a Zacks Rank #2 (Buy). These stocks sport a notably stronger earnings outlook and the potential to deliver explosive gains in the near term.More By This Author:These 3 Companies Shattered Quarterly RecordsDividend Watch: 3 Companies Boosting PayoutsThese 3 Companies Recently Lifted Guidance