Trading Starbucks After Q4 Earnings Report

November 07, 2022 11:36

Shares in Starbucks have risen around 34% from the lows of the year so far. However, the stock is still down 27% from its record high of $126.32 recorded in July 2021.  

The world’s largest coffee chain just reported its fourth-quarter earnings. The results were much better than expected helping the stock to rise but there are some global economic concerns to consider.  

Learn how to trade Starbucks shares below.

Stock: Starbucks
Symbol for Invest.MT5 Account: SBUX
Date of Idea: 7 Nov 2022
Time Line: 1 - 6 months
Entry Level: $93.00
Target Level: $136.00
Position Size for Invest.MT5 Account: Max 5%
Risk: High
  • The Invest.MT5 account allows you to buy real stocks and shares from 15 of the largest stock exchanges in the world.

All trading is high risk and you can lose more than you risk on a trade. Never invest more than you can afford to lose as some trades will lose and some trades will win. Start small to understand your own risk tolerance levels or practice on a demo account first to build your knowledge before investing. 

Takeaways From Starbucks’ Fourth-Quarter Earnings Report

Starbucks reported a much better-than-expected fourth-quarter earnings report. While earnings fell 19% from the same time last year they exceeded Wall Street’s expectations. Sales from the United States were up 11% while international sales also rose 7%.  

This was helped by daily store traffic increasing to around 95% of the level before the pandemic. It was a different story in China as sales were down 16% due to regional lockdowns. Though, this was better than the 44% decline in the prior quarter.

The earnings report also stated that the group sees worldwide sales growing by 7% to 9% in 2023 with an improved earnings forecast growth of 15% to 20% over the next three years.

However, one major issue to take into consideration is the fact dozens of cities in China have gone back into lockdown as they enforce a Zero COVID policy. This is likely to weigh even further on the company’s China sales over the next quarter.  

There is also the looming threat of recession in the US and Europe due to a mix of higher interest rates and inflation but an upbeat holiday season may help to balance things out in the next quarter.

Starbucks Stock Forecast - What do the Analysts Say?

According to analysts polled by TipRanks for a Starbucks stock forecast in the past 3 months, there are currently 13 buy, 10 hold and 0 sell ratings on the stock. The highest price level for a Starbucks stock forecast is $136.00 with the lowest price target at $88.00. 

The average price target for a Starbucks stock forecast is $100.35.

Source: TipRanks, 7 Nov 2022 


An Example Trading Idea for the Starbucks Stock Price

An example trading idea for the Starbucks share price could be as follows:  

  • Buy the stock at $93.00 to allow for current market volatility. 
  • Target just below the highest analyst price target at $136.00. 
  • Keep your risk small at a maximum of 5% of your total account.   
  • Time Line = 1 – 6 months  
  • If you buy 10 Starbucks shares:  
    • If target is reached = $430.00 potential profit ($136.00 - $93.00 * 10 shares).

Remember that markets go up and down and it is unlikely the share price will move up in a straight line. In fact, it may even go much further down before it rises, especially considering that Starbucks is still down around 20% this year so far.

Be sure to exercise good risk management and always know how much you could potentially lose on a trade and the risks involved, as well as the costs.

With the Admirals Invest.MT5 account you can buy and sell US stocks with a commission from $0.02 per share. This means buying 10 shares in Starbucks stock would result in a commission of $0.20 ($0.02 * 10 shares) for executing a per-side transaction.

There is a low minimum transaction fee of $1. So, the example trading idea above would result in a commission of just $1 overall! 

How to Buy Starbucks Stock in 4 Steps  

With Admirals, you can buy shares in companies like Starbucks with a low commission of just $0.02 per share and a low minimum commission of just $1 on US stocks. 

  1. Open an account with Admirals to access the Trader’s Room.   
  2. Click on Trade on one of your live or demo accounts to open the web platform.   
  3. Search for your stock at the bottom of the Market Watch window and drag the symbol onto the chart.   
  4. Use the one-click trading feature, or right-click and open a trading ticket to input your trade size, stop loss and take profit level. 
Source: Admirals MetaTrader 5 Web. Past performance is not a reliable indicator of future results, or future performance. 


Click on the banner below to buy Starbucks stock today! ▼▼▼ 

Do You See the Starbucks Stock Price Moving Differently?   

Remember that all analytics and trading ideas are based on the personal view and experience of the author.  

If you believe there is a higher chance Starbucks's share price will move lower, then you can also trade short from a CFD (Contracts for Difference) trading account which Admirals also provide.  

The Trade.MT5 and Trade.MT4 account allows you to speculate on the price direction of stocks and shares using CFDs.  

This means you can trade long and short to potentially profit from rising and falling stock prices. Learn more about CFDs in this How to Trade CFDs article. 


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Jitanchandra Solanki
Jitanchandra Solanki Financial Markets Author, Admirals London

Jitanchandra is a financial markets author with more than 15 years experience trading currencies, indices and US equities. He is an accredited Market Technician with a BA Hons degree.