Sector Snap: Coffee Retailers

Chron.com:

Shares of some coffee retailers fell Friday, led by Peet’s Coffee & Tea Inc., after posting disappointing results, but Starbucks Corp. regained some ground from Thursday’s plunge. Peet’s Coffee & Tea Inc. posted a 32% drop in profit late Thursday, missing Wall Street estimates by a penny. On Friday, shares fell $1.22, or 4.5%, to $26.09 in morning trading on the Nasdaq. The stock has traded between $25 and $33.46 during the past year.

Also late Thursday, Caribou Coffee Co. Inc. said its 2nd-quarter loss widened, and results were worse than analyst expectations. Same-store sales, or sales in stores open at least 1 year, a widely used industry gauge of performance, dropped 4%. Caribou said it will try to improve business by opening new stores, introducing new products and increasing franchising opportunities.

Rachael Rothman, an analyst at Merrill Lynch, on Friday called the new products and distribution ‘a positive,’ but kept her ‘Neutral’ rating. She cited ‘the high degree of uncertainty surrounding the ability of the company to hit our estimates.’

Caribou shares fell 16 cents, or 2.5%, to $6.04 on the Nasdaq.

Earlier Thursday, Starbucks shares sank after it said July sales grew at their slowest pace in nearly 5 years. The company said the lag was due in part to an increase in demand for Frappuccinos, frozen blended drinks which take longer to prepare, which prompted a slowdown in traffic during peak morning hours. On Thursday, Starbucks shares fell $2.66, or 8%, to close at $30.64 on the Nasdaq. On Friday, shares recovered slightly, rising 12 cents to $30.76.