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Starbucks Q4 Earnings Show Strength: ETFs In Focus

Leading coffee chain Starbucks Corporation (NASDAQ:SBUX) ended its fiscal 2015 fourth quarter with lower-than-expected earnings. The softer earnings were driven by higher employee and digital investments. However, the company's top line saw a strong upside, thanks to outstanding growth in traffic trends in the U.S.

Starbucks' fiscal 2016 outlook was in line with the market as well as our expectations. Shares of the company rose in the trading session following the earnings release but fell thereafter.

Starbucks' adjusted earnings of 43 cents per share missed the Zacks Consensus Estimate of 44 cents by 2.3%. However, earnings were on the higher end of management's guided range and grew 16% year over year as solid top-line growth offset lower margins.

Fiscal fourth quarter sales escalated 18% year over year to $4.91 billion, outpacing the Zacks Consensus Estimate of $4.89 billion by 0.5% driven by robust comps. Global same-store sales (comps) growth of 8% was higher than a 7% rise in the previous quarter, driven by increased traffic trends. The comps rise included 4% improvements each in global traffic and average ticket.

Higher food/beverage sales, strong comps in the U.S. and Europe and incremental revenues from Starbucks Japan primarily drove sales. The coffee giant opened 1,677 net new stores in fiscal...


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