Starbucks Stock Analysis (NASDAQ:SBUX)

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$57.98 $0.05 (0.09%) SBUX stock closing price Jul 21, 2017 (Closing)
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Starbucks
Updated on : Jul 21, 2017
previous close
SBUX 58 (0%)
S&P 500 2472.5 (0%)
Closing Price On: Jul 21, 2017
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Retail-Food and Restaurants
Sector :
Retail-Wholesale
5 Quarter Revenue
Revenue Growth
2017-Q2
$billion
%
YOY GROWTH
Compared to the industry
Operating Profit
Operating Margin:
19.7%
Sector Average:
5.7%
5 Quarter Net Profit
Net Margins
2017-Q2
%
LTM Margin
Compared to the industry
Debt/Equity Ratio
Debt:
3.97B
Debt/Equity Ratio:
 0.71
Compared to the industry
Cash Flow
Operating cash flow:
$443.3M
Net Income:
$652.8M
Dividend Yield
SBUX dividend yield:
1.55%
PROS      CONS
Recent Growth
Operating Margins
Net Margins
ROIC
ROE
High Debt Burden
Cash Flow
PE Valuation
PS Valuation
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
SBUX PS :
3.9
Industry PS :
0.7
Sector:   Retail-Wholesale.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
38%
Return on Equity:
52.6%
Free Cash Flow Margin:
2.1%
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Starbucks Analysis Video

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View Starbucks stock analysis video. This is our SBUX analyst opinion covering the buy and sell arguments for SBUX stock.

Starbucks Corporation Stock Rating (3.3/5)

Our Starbucks stock opinion is based on fundamentals of the company. This Starbucks stock analysis is based on latest Q2 earnings for 2017. The stock price analysis takes into account a company's valuation metrics.

Should you buy SBUX stock?

  • The Year Over Year (YoY) revenue growth for Starbucks was 6% in 2017 Q2.
  • Starbucks's average operating margin of 19.7% was exceptional.
  • Net margins stood at a healthy 13.5% (average) for Starbucks in the Trailing Twelve Months.
  • Starbucks has an attractive ROIC (Return on Invested Capital) of 38%
  • The LTM ROE of 52.6% for Starbucks is attractive.

Should you sell SBUX stock?

  • Starbucks is debt laden and has a high debt/equity ratio of  0.71.
  • The company has an operating cash flow which is 0.7 times the net income. This is not a healthy sign.
  • The SBUX stock currently trades at a PE of 28.7, which is expensive, compared to the industry average of 17.4.
  • 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.

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