Starbucks Stock Analysis (NASDAQ:SBUX)
Starbucks Analysis Video
View Starbucks stock analysis video. This is our SBUX analyst opinion covering the buy and sell arguments for SBUX stock.
Starbucks Corporation Stock Rating (3.6/5)
Our Starbucks stock opinion is based on fundamentals of the company. This Starbucks stock analysis is based on latest Q1 earnings for 2017. The stock price analysis takes into account a company's valuation metrics.
Should you buy SBUX stock?
- Starbucks's revenue growth came in at 6.7% in 2017 Q1.
- Starbucks's average operating margin of 19.6% was exceptional.
- Net margins came in at average 13.3% for Starbucks over the last twelve months.
- The company has an operating cash flow which is 2 times the net income.
- Starbucks's return on invested capital of 38.8% is good.
- The LTM ROE of 50.6% for Starbucks is attractive.
- The company has a good Free Cash Flow (FCF) margin of 20.7%.
Should you sell SBUX stock?
- With a debt/equity ratio of 0.55, Starbucks is highly leveraged in comparison to Retail-Wholesale peers.
- SBUX stock is trading at a PE ratio of 29, which is worse than the industry average multiple of 18.4.
- The company is trading at a price to sales multiple of 3.9, which is higher in comparison to the Retail-Food and Restaurants industry average of 0.7, making SBUX stock expensive.