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 sales grew by 6.7% year on year in 2017 Q1.
- The TTM operating margin was good at 19.6% for Starbucks.
- 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 has an attractive ROIC (Return on Invested Capital) of 38.8%
- The LTM ROE of 50.6% for Starbucks is attractive.
- The company has a healthy free cash flow 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.
- Trading at a PE ratio of 28.5, SBUX stock is overvalued in comparison to industry average multiple of 18.7.
- The company is trading at a price to sales multiple of 3.8, which is overvalued in comparison to the Retail-Food and Restaurants industry average multiple of 0.7.