• JPMorgan, Stifel, and Bank of America hiked their price targets on the stock this week.
• Of the 39 analysts covering the SBUX stock, 19 have a ‘Hold’ rating on the stock. 
• For Q2, the consensus estimates are $9.20 billion in revenue and $0.41 in earnings per share, according to Fiscal AI.

Coffeehouse giant Starbucks is set to report its second-quarter earnings on Tuesday next week, after the closing bell. Ahead of the earnings report, JPMorgan, Stifel, and Bank of America hiked their price targets on the stock.

For the second quarter (Q2), the consensus estimates are $9.20 billion in revenue and $0.41 in earnings per share (EPS), according to Fiscal AI.

For its first quarter, the company saw revenue jump 6% to $9.9 billion, surpassing the estimate of $9.22 billion, and posted EPS of $0.56, which came in $0.03 short of expectations.

Wall Street’s Take Prior To Earnings

JPMorgan raised its price target to $100 from $95, and kept its ‘Overweight’ rating on Starbucks. The price target hike was part of the firm’s broader adjustment in the restaurants and foodservice distribution space, as it balances the macro backdrop with the "idiosyncratic," TheFly reported. 

Stifel increased its price target to $115 from $105, along with a ‘Buy’ rating. The analyst expects in-line EPS and believes domestic sales trends have been "solid" for the company based on a review of mobile location data, per TheFly. The price target implies an upside potential of over 15%.

Meanwhile, BofA upped its price target to $130 from $120 and has a ‘Buy’ rating. Like JPMorgan, the price target adjustment on SBUX was part of a broader revision to the firm's restaurant-sector coverage. The price target implies an upside potential of more than 30%.

Starbucks’ Nashville Updates

On Tuesday, the company announced that it will open a corporate office in Nashville, Tennessee, and employ as many as 2,000 workers as part of its $100 million investment in the region. 

Some jobs from its Seattle, Washington headquarters are expected to move to the new office, which will receive many tax breaks and save a whole year’s worth of rent. The new office facility is expected to be ready by 2027.

During the week, Starbucks also announced a new “Mobile Order & Pay” feature for its North American customers, which will be available from May 11. Customers will now be able to place an order online up to 1 hour ahead of their visit to a specific outlet.

In April, the company started beta testing in the popular ChatGPT app to help users discover different drinks “in a way that feels natural, personal, and fun.”

How Did Retail Traders React?

On Stocktwits, retail sentiment about the SBUX was ‘bearish’ over the last 24 hours, amid ‘high’ messaging volumes.

One user on the platform recently posted that the company is overvalued.

Another user thinks the stock will breach $112 soon.

Wall Street analysts are largely neutral on Starbucks going into earnings. About 39 analysts cover the SBUX stock, of which 19 have rated it ‘Hold,’ 17 ‘Buy’ or higher, and four ‘Sell’ or lower, according to data from Koyfin.

SBUX managed to outperform the benchmark S&P 500 index so far this year, but trailed far behind over the last 12 months. 

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