Is it smart to buy stock in Starbucks?
It's true that Starbucks is a mature business that's unlikely to grow at the over 20% rate that investors are seeing with, say, Dutch Bros. But it still has highly productive projects to which it can direct its ample cash flow. That's why investors should still consider it a buy today.
The chain is highly profitable and cash rich, and it's boosting customer satisfaction among its most loyal shoppers. These factors suggest Starbucks will be back to its winning ways before too long. Looking back in a few years, investors could be happy they decided to snap up Starbucks' shares at a discount in 2024.
Starbucks has 17.41% upside potential, based on the analysts' average price target. Starbucks has a conensus rating of Moderate Buy which is based on 10 buy ratings, 15 hold ratings and 0 sell ratings. The average price target for Starbucks is $107.30.
Valuation metrics show that Starbucks Corporation may be fairly valued. Its Value Score of C indicates it would be a neutral pick for value investors. The financial health and growth prospects of SBUX, demonstrate its potential to perform inline with the market. It currently has a Growth Score of A.
This Zacks Rank #3 (Hold) company's earnings and sales in fiscal 2024 are likely to witness growth of 14.7% and 7.8% from the year-ago levels, respectively. The company also has an impressive long-term earnings growth rate of 15.5%.
Some of the risks that investors should be aware of when it comes to Starbucks include competition, commodity prices, market risk, and its performance in emerging markets.
SBUX also holds an average earnings surprise of 6.9%. SBUX should be on investors' short lists because of its impressive earnings and valuation fundamentals, a good Zacks Rank, and strong Value and VGM Style Scores. To read this article on Zacks.com click here.
Investors have lost their taste for Starbucks stock as the company faces headwinds in key markets across the globe. We also remain tentative on the next steps until these challenges roll over and the company shows proof of improving financials.
The steady decline off that May high was prompted by a disappointing outlook that accompanied the coffee brewer's fiscal Q2 earnings report. The stock gapped higher to start November after roundly beating fiscal Q4 earnings expectations, but SBUX has since pulled back to fill that bull gap.
Stable Share Price: SBUX has not had significant price volatility in the past 3 months. Volatility Over Time: SBUX's weekly volatility (2%) has been stable over the past year.
Is Starbucks a good long term stock?
SBUX is a #3 (Hold) on the Zacks Rank, with a VGM Score of B. It also boasts a Value Style Score of B thanks to attractive valuation metrics like a forward P/E ratio of 23.7; value investors should take notice.
Key Points. The Motley Fool recommended Starbucks in 1998; shares have made millionaires since then. Today, the dominant coffee house chain still has a myriad of buttons to push for growth. With the stock at 52-week lows, investors should enjoy strong long-term investment returns.
What happens to my Bean Stock if I leave Starbucks? Any shares you hold from vested Bean Stock are yours to keep. You can hold these shares at Fidelity regardless of your employment with Starbucks. Any unvested Bean Stock will be cancelled upon separation.
Globally, Starbucks expects to approach 45,000 stores by the end of 2025, and is well on track to reach approximately 55,000 stores by 2030, as projected at its 2020 Investor Day. Starbucks now expects global revenue growth in the range of 10% to 12% annually from fiscal 2023 to fiscal 2025.
Each November, eligible partners receive Bean Stock after the Starbucks Board of Directors approves the annual grant. Your Starbucks Stock team will load your new grant to your Fidelity NetBenefits account and send notice when it's viewable, usually by mid-December.
Starbucks stock price stood at $86.85
According to the latest long-term forecast, Starbucks price will hit $90 by the end of 2024 and then $95 by the middle of 2025. Starbucks will rise to $100 within the year of 2026, $110 in 2027, $125 in 2028 and $150 in 2030.
According to the latest TipRanks data, approximately 39.82% of Starbucks (SBUX) stock is held by retail investors. Vanguard owns the most shares of Starbucks (SBUX).
A great dividend-growth track record
That's significantly higher than the S&P 500's current yield of 1.4%. It's also closer to its highest levels over the past decade. The company is in an excellent position to continue increasing its dividend in the future.
Starbucks' net revenue reached 29.46 billion U.S. dollars in 2023. This shows an increase over the previous year's total of 26.58 billion U.S. dollars.
You often don't need a lot of money to start. Currently, the minimum amount of money you'll need to invest in Starbucks is $500. But one of the downsides is that the ongoing fees can really nibble away at your profit, compared to investing apps and online brokerages, which can offer no-commission trades.
How much do you need to invest in a Starbucks?
The average licensing cost required to open a Starbucks is a $315,000 licensing fee and a net worth requirement of at least $700,000.
The company's largest shareholder is The Vanguard Group, Inc., with ownership of 9.4%. In comparison, the second and third largest shareholders hold about 7.0% and 4.0% of the stock.
Simply put, if you stay employed by Starbucks for at least one year from the grant date with no breaks in service, you will receive the first half of your Bean Stock. If you remain employed two years from the grant date, you will receive the second half. Once you own the shares, you can hold or sell them.
Dividend Data
Starbucks Corporation's ( SBUX ) dividend yield is 2.57%, which means that for every $100 invested in the company's stock, investors would receive $2.57 in dividends per year. Starbucks Corporation's payout ratio is 57.56% which means that 57.56% of the company's earnings are paid out as dividends.
For fiscal 2024, the company now anticipates revenue growth of 7% to 10%, down from its prior forecast of 10% to 12%. Starbucks also lowered its global same-store sales outlook to a range of 4% to 6%, from its previous range of 5% to 7%.
