Analyst Note
| Nicholas Johnson, CFA |A year after the coronavirus pandemic first shuttered Starbucks stores in China, the company demonstrated its continued dominance in the coffee space in the first quarter of fiscal 2021, with adjusted EPS of $0.61 that exceeded both our forecast of $0.52 EPS and its own guidance. While the firm has not been completely unscathed by the pandemic, we were encouraged by the growth of its rewards program (which reinforces Starbucks’ wide moat) and the improvements already seen in the international segment, particularly in China, which has set the road map to recovery for the rest of the business. As a result, we will not be making any material changes to our fair value estimate of $100, and shares strike us as fully valued.