Starbucks stock pops on earnings beat, buyback news

July 27 01:24 2015

The coffee chain reported quarterly earnings and revenue that beat analysts’ expectations on Thursday. Starbucks posted fiscal third-quarter earnings of 42 cents per share on $4.88 billion in revenue. Analysts forecast Starbucks would report earnings of 41 cents a share on $4.86 billion in revenue, according to a consensus estimate from Thomson Reuters.To Settle Grocery Dispute, Starbucks Agree To Pay $2.76 Billion

After the earnings announcement, the company’s shares rose more than 5 percent in extended-hours trading. The coffee giant is trading well above its $57 all-time high at current extended-hours levels. The retailer also announced on Thursday that it would be repurchasing 50 million shares as part of its buyback program. This is in addition to the 11 million shares that were available for repurchase as of June 28, 2015, the company said.

Starbucks expects full-year revenue growth of 16 to 18 percent. Global comparable-store-sales growth will remain in the mid-single digits. Comp-store sales were up 7 percent globally, compared with an estimate of 6.2 percent, according to Consensus Metrix. The same metric came in at 8 percent for the Americas and 11 percent in China/Asia Pacific. All three numbers were a beat compared to consensus estimates by the same firm.

Starbucks’ Americas region, which includes the United States, Canada and Latin America, contributes the majority of company revenue. Most of the gains in the key metric were driven by a 4 percent increase in traffic.