Starbucks Corp forecast 2014 profit below Wall Street’s view, despite fourth quarter profits that jumped 34 percent on strong traffic gains and a rise in spending by its customers.
Shares in the world’s biggest coffee chain, one of the economy-defying growth companies such as burrito chain Chipotle Mexican Grill and upscale grocer Whole Foods Market Inc , fell 2.4 percent to $78.90.
Expectations run exceedingly high for high-flying companies like Starbucks, and any perceived stumble is often punished in the form of a share selloff.
Starbucks on Wednesday repeated its forecast for fiscal 2014 earnings in the range of $2.55 to $2.65 per share. Analysts’ average estimate had called for a full-year profit of $2.67 per share, according to Thomson Reuters I/B/E/S.
“We’re one month into their fiscal year. One month into a fiscal year, you’re typically not going to have revisions to guidance,” William Blair analyst Sharon Zackfia told Reuters.
“The trends look very healthy,” Zackfia said of Starbucks.
On Wednesday, the Seattle-based company reported that profit increased to $481.1 million, or 63 cents per share, for the fiscal fourth quarter ended Sept. 29, from $359 million, or 46 cents per share, a year earlier.
Global sales at Starbucks cafes open at least 13 months were up 7 percent during the latest quarter, driven by a 5 percent increase in traffic.
That figure included a stronger-than-expected 8 percent rise for the U.S.-dominated Americas region that contributes nearly three-fourth of Starbucks revenue.
Starbucks’ consolidated operating margin expanded 220 basis points to 17.6 percent during the fourth quarter, with increases from every operating unit.
The company’s business got a boost from the addition of premium tea, juice and bakery products from recently acquired companies. Starbucks also has linked its cafe, grocery and loyalty card programs, connections it says has bolstered sales.
Starbucks bought tea retailer Teavana and the parent of La Boulange Bakery last year. Those purchases came on the heels of its acquisition of juice maker Evolution Fresh in 2011.
Starbucks this month opened its first Teavana retail shop in Manhattan and introduced “tweet-a-coffee,” technology that allows Twitter users with Starbucks cards to send $5 digital gift cards to friends.