Starbucks Corp (NASDAQ:SBUX) Earnings Model
Author: Robert Dymond, Published: July 21, 2019 10:50pm Category: Earnings Preview (Fiscal 3Q2019)
Model Summary: This model breaks down Starbucks earnings in geographical segments: Americas, CAP, and EMEA. The main drivers of this model are the estimates of comp store sales, net new stores, and the ratio of operating expenses (excluding depreciation) as a percentage of revenue. This model assumes increased competition in China from Luckin and other competitors, an intensified economic downturn in Europe, and success in the U.S. due to changes in the customer loyalty program as well as new beverage initiatives. As a result of these assumptions, I am modeling a decrease in comparable store sales in the CAP segment in addition to a decrease in net new stores which will fall below management guidance. In the Americas segment, I am modeling strong revenue growth over the next four quarters as a result of increasing comparable store sales and expanding operating margins.
Disclosure: The author of this article/model has no financial investment or other conflict of interest related to the subject company or other companies discussed. Any views made or implied in the content represent the author’s opinions.