Taking a sip of Starbucks stock Wednesday morning?
The coffee giant reported earnings after the bell Tuesday and results came in widely better than expected. Starbucks took a loss per share of 46 cents, marking an improvement over the expected loss of 59 cents per share. Total revenue came in at $4.2 billion, ahead of estimates of $4.06 billion, but down over 38% year-over-year.
Same-store sales rose 7% in the quarter, compared to a 41% decline in the previous quarter.
The company also said it expects the effects of the coronavirus pandemic on its business to “moderate meaningfully in the fourth quarter.” Starbucks expects earnings per share for the current quarter to come in at roughly 25 cents.
So where does Starbucks head from here? Ed Ponsi, managing director of Barchetta Capital Management, noted on Ponsi Charts that $70.65 is the level to watch in Starbucks stock. “Starbucks has an opportunity to emerge from the Covid-19 crisis a leaner, more efficient company,” Ponsi wrote.
Starbucks is also a holding in Jim Cramer’s Action Alerts Plus charitable portfolio. Cramer said the investments Starbucks's disclosed for the coming quarters shows the company recognizes that social distancing is here to stay.
Jim Cramer and Katherine Ross are going live on Street Lightning Thursday, July 30 at 10:30 a.m. ET to discuss all things Apple ahead of a very full slate of tech earnings after the bell Thursday.
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