Last Updated: 17 Sep 2024
Executive Summary
Starbucks Corporation (SBUX) is a leading global coffeehouse chain with a strong brand and a loyal customer base. The company has been facing challenges in recent quarters due to macroeconomic headwinds and increased competition. However, Starbucks remains a fundamentally sound company with a long-term growth potential.
Company Overview
Starbucks was founded in 1971 in Seattle, Washington. The company has since grown to become the world's largest coffeehouse chain, with over 34,000 stores in 80 countries. Starbucks offers a wide variety of coffee, tea, pastries, and other food items. The company also has a strong loyalty program, which has helped to drive repeat business.
Fundamental Analysis
Starbucks has a strong financial profile. The company has a market capitalization of over $111 billion and an EBITDA of $7.08 billion. Starbucks also has a strong balance sheet, with $5.1 billion in cash and equivalents and $1.7 billion in debt.
Starbucks' profitability metrics are also strong. The company has a profit margin of 11.2% and an operating margin of 15.8%. Starbucks also has a high return on assets of 11.7%.
Starbucks' growth prospects are also positive. The company is expected to continue to grow its store count in both the United States and internationally. Starbucks is also investing in new products and initiatives, such as its mobile app and its Reserve Roastery concept.
Technical Analysis
Starbucks' stock price has been in a downtrend since early 2023. The stock has fallen from a high of $105.57 in January to a low of $70.83 in June. The stock is currently trading at $96.31.
The technical analysis of Starbucks' stock is mixed. The stock is below its 50-day and 200-day moving averages. However, the stock is above its 52-week low. The relative strength index (RSI) is also above 50, which indicates that the stock is not oversold.
Short Term Outlook
The short-term outlook for Starbucks' stock is mixed. The stock is facing headwinds from macroeconomic factors and increased competition. However, the stock is also supported by the company's strong financial profile and growth prospects.
Long Term Outlook
The long-term outlook for Starbucks' stock is positive. The company is a leader in the global coffeehouse industry and has a strong brand and a loyal customer base. Starbucks is also well-positioned to benefit from the growing demand for coffee and tea.
Analyst Recommendations
The majority of analysts have a buy rating on Starbucks' stock. The average analyst target price is $95.54.
