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On The Call @ Hedgeye this morning, Hedgeye Consumables analyst Howard Penney and CEO Keith McCullough discuss the "low quality" Q3 earnings report from Starbucks (SBUX).

They’re still down double digits from 2019, so the business hasn’t recovered,” explains Penney.

As Penney discusses management's plans to ‘reimagine the company’ heading into 2023, he explains “that reimagining the store base and putting a lot of technology into the store base is going to cost a lot of money. It’s going to be expensive. Margins are probably going to be down again next year.”

“If we have #Quad4 for the next 4 quarters, earnings get #Quad4’d,” comments McCullough. “Looking backwards, it’s like ‘oh earnings are great! Stocks are cheap,’ but that thing’s going to collapse.”

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(This clip is a small taste of what our subscribers get each day on The Call @ Hedgeye. In a nutshell, The Call is our morning research call hosted by Hedgeye CEO Keith McCullough with our 40+ analyst research team. It helps small and large investors alike make better decisions via unique and investable stock/sector updates CLICK HERE to learn more.)