Bullish on Starbucks
Posted: Apr 09, 2024
- Starbucks currently has a P/E ratio of 23, which may seem high, but there are reasons to invest beyond just the numbers. - The addictive nature of coffee and fast consumption of Starbucks' products keeps customers coming back. - Starbucks has valuable assets like brand recognition and inviting store atmosphere that contribute to future revenue streams. - Starbucks has a 25% Sustainable ROIC and an average operating margin of 15.5%, showing strong financial performance. - Despite being well-established, Starbucks continues to expand at a steady pace, opening about 6% new stores annually, highlighting growth potential. - Geographically, Starbucks has room for international expansion, with many untapped markets in areas like China and India. - The company's goal is to reach 55,000 stores by 2030, showing commitment to further growth. - An intrinsic value model by the poster calculated Starbucks to be worth $112 per share, based on realistic assumptions about revenue growth, reinvestment, and other factors. - Starbucks is seen as a compelling investment opportunity due to its financial performance and growth potential.
Stay ahead of the market with AI stock alerts & AI summaries of the latest earnings, stock ideas for free with Fluid Bot. Sign up now!