Shares of Starbucks were higher on Thursday’s close after reporting better-than-expected earnings and revenue results for the fourth quarter of fiscal 2016.
The Seattle-based beverage company later reported its adjusted earnings of 56 cents per share at the close of market, beating analysts’ forecast of 55 cents per share, with revenue rallying at 16% year-over-year to $5.71 billion, topping analysts’ expected revenue of $5.69 billion.
The company’s same-store sales rallied 4.0% year-over-year, missing analysts’ consensus growth of 4.9%.
Meanwhile, Starbucks is expecting its adjusted revenue to hit between $2.12 and $2.14, and a double-digit for its revenue growth for fiscal 2017. Analysts forecast for the adjusted earnings stood at $2.16 per share.
The beverage company’s latest closing price distance settled at approximately 5.90% from the average-price of 200 days, while its 50-day moving average remained steady at -2.39%, compared with the 20-day moving average of -0.53%.
The mean recommendation for Starbucks Corporation stands at 1.70 with a rating scale of 1.0 being the Strong Buy, 2.0 rating suggesting Buy, 3.0 rating signifying Hold, 4.0 rating implying Sell and 5.0 rating displaying Strong Sell.
Uncertainty on US Election Cools Starbucks’ Business
It is likely that the company’s executives can’t wait until the day after the US Presidential Election Day on November 9.
"I would label this time as one with a high degree of uncertainty -- domestically driven -- but it has affected the rest of the world. Where we have visited, we have never witnessed such concern as a result of the (U.S. presidential) election," Starbucks CEO Howard Schultz said.
Mr. Schultz also added, "It's very hard to cut through the noise and get our message to the consumer."
With the rising noise from the contentious battle for the U.S. presidency all over on 24/7 cable news networks and social media seemed to take its toll on how consumers made interactions with Starbucks worldwide in its most recent quarter.
Further, many are saying that the election outcome uncertainty is a significant aspect in Starbucks offering various guidance for the first six months of its new fiscal year.
Current Stance of Starbucks Corp’s Shares
The chart below illustrates the Starbucks Corp. stock’s movement after reporting better-than-expected earnings and revenue results for the fourth quarter of fiscal 2016.
Given a bearish tone on the beverage company shares, several investors are calling for Buying their shares. In essence, the stock price begun to follow a downward trend on August 24 at resistance 57.95 and support 55.43 and consolidated.
Ahead of a consolidating move, stock prices significantly declined in a heavy trading volume at resistance at 52.92 and support 51.36 in today’s session.
As Starbucks Corporation shares remained on a bearish tone, our study suggests that the biggest downfall of the tech giant was led by heightened uncertainties on the U.S. presidential election.
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