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Starbucks has been a stalwart holding in the Hedgeye virtual portfolio considering that we’ve owned the stock for more than three years. But those who are looking to get long SBUX now should wait, according to Hedgeye Restaurants Sector Head Howard Penney. Last week’s acquisition of La Boulange Bakery will dilute earnings per share for the second half of fiscal year 2012. Getting the infrastructure and distribution in place for a national rollout is going to be capital intensive and Penney says he would not buy the stock right now. Hedgeye believes that the consensus for EPS is simply too bullish.

SBUX: Playing The Game - SBUX.SP.final

Another headwind that exists is Europe, who apparently can’t catch a break on anything these days. Starbucks CFO Troy Alstead spoke at a conference on Monday and aside from the lower EPS estimates, he also warned that the company is experiencing increased pressure in its EMEA (Europe, Middle East & Africa) division during the third fiscal quarter ending June 30.

Essentially, Starbucks is going to have to work hard through the rest of the year to justify its recent spree of high dollar acquisitions.