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 (3.4/5)
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.
- Starbucks had a healthy average operating margin of 19.6% over the last 4 quarters.
- LTM Net margins were good at 13.3% for Starbucks.
- The operating cash flow looks good at 2 times the net income.
- Starbucks's return on invested capital of 38.8% is good.
- Return On Equity (ROE) which is a measure of the company's profitability, looks great for Starbucks at 50.6%.
- Starbucks has a healthy FCF (Free Cash Flow) margin of 20.7%.
Should you sell SBUX stock?
- Starbucks has a debt/equity ratio of 0.55, which is worse than the average in the Retail-Wholesale sector.
- Trading at a PE ratio of 30.6, SBUX stock is overvalued in comparison to industry average multiple of 19.9.
- The company is trading at a price to sales multiple of 4.1, which is higher in comparison to the Retail-Food and Restaurants industry average of 0.7, making SBUX stock expensive.