Starbucks Corporation (NASDAQ:SBUX) announced financial results for its fiscal third quarter ended July 1, 2007. Consolidated net revenues of $2.4 billion increased 20 percent and were in line with expectations. Net earnings per share of $0.21, compared to $0.18 per share last year and a consensus estimate of $0.21. The company left its guidance for this year unchanged and introduced fiscal 2008 guidance:
- New store openings of approximately 2,600, accelerating International openings by 200 stores
- Comparable store sales growth in the range of three to seven percent
- Total net revenue growth of approximately 18 percent
- Fiscal 2008 earnings per share growth of approximately 20 percent to 22 percent
None of these numbers were particularly surprising, but shares traded up after the announcement anyway. Perhaps the rally at the market close was continuing, perhaps investors were fearing worse, or perhaps there were simply more buyers than sellers.
Whatever the reason, Starbucks continues to post same store sales numbers many other retailers would drool over despite adding new stores at a pace some have called overcaffeinated. As for me, I see little change since I last wrote about the company’s prospects, at which time I estimated potential returns of 9-17% annually for the foreseeable future. And that is a chance I am willing to take.
Disclosure: author is long Starbucks (SBUX) at time of publication.
SBUX 1-yr chart: