Here's What 2 Analysts Are Saying About Starbucks Ahead Of Its Q1 Report

Starbucks Corporation (NASDAQ: SBUX) will report its second quarter results on Thursday after market close.

The Estimize Consensus earnings per share estimate (based on 61 estimates) is $0.34 on revenue of $4.506 billion. This compares to the Wall Street Consensus earnings per share estimate of $0.33 on revenue of $4.509 billion.

Goldman Sachs: Starbucks A Top Pick

Karen Holthouse of Goldman Sachs commented in a note that Starbucks is a top pick heading into earnings season and the company should report a "clean quarter" despite weather disruptions and a 5 percent America's comp shows "sufficient strength" in the underlying business.

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Holthouse added that more importantly, Starbucks's commentary on its mobile ordering initiatives should drive "excitement" and a traffic acceleration in the back of the year and heading into 2016.

The analyst also noted that coffee spot prices (in the low $1.30 range) is well off peak levels and would be expected to hit in 2016. Investors will likely focus on the potential for this to flow-through versus be offset by incremental spending elsewhere.

Shares are Buy rated with a $53.50 price target.

RBC: Checks Point To A Positive Quarter

David Palmer of RBC Capital Markets stated in a note that his proprietary consumer panel analysis of activity through March was most positive.

According to Palmer's analysis, Starbucks' second quarter same-store sales growth is expected to be in the 4 percent to 5 percent range. The analyst added that a 5 percent growth is in-line with investor expectations, it is possible sales growth will accelerate during the remainder of the year driven by technology investments that will "bolster" near-term throughput, frequency and check.

Palmer also noted that his channel data suggested Starbucks has continued to gain share of packaged coffee and single serve (K-Cups). In the most recent 12-week period, Starbucks' K-Cups market share of packaged coffee and K-Cups rose to 10.9 percent and 15.9 percent from 10.4 percent and 13.7 percent last year, respectively.

Palmer concluded that Starbucks should report a revenue acceleration that coincides with cost of goods sold (COGS) efficiencies and favorable commodity costs.

Shares are Outperform rated with a $50 price target.