A Lukewarm Cup O' Starbucks: Fool by Numbers
By
Anders Bylund
January 31, 2008
|
On Jan. 30, Starbucks (Nasdaq: SBUX) released first-quarter 2008 earnings for the period ended Dec. 30, 2007.
- Starbucks opened 484 net new stores domestically this quarter, and 261 abroad. With revised store opening plans aiming for 1,175 U.S. openings and 975 internationals this year, you should expect fewer new locations at home while international expansion continues apace.
- If not for a generous share buyback program, financed by a combination of fresh cash and not-too-stale debt, the earnings-per-share growth would have stalled entirely.
- On the bright side, a slower build-out schedule will mean swifter cash flow growth over the next few quarters. You have to take the bad with the good sometimes.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Q1 2008
|
Q1 2007
|
Change
|
|
Sales
|
$2,768
|
$2,356
|
17.5%
|
|
Net Profit
|
$208
|
$205
|
1.5%
|
|
EPS
|
$0.28
|
$0.26
|
7.7%
|
|
Diluted Shares
|
744.9
|
782.8
|
(4.8%)
|
Get back to basics with the income statement.
Margin Checkup
|
Q1 2008
|
Q1 2007
|
Change*
|
|
Gross Margin
|
57.2%
|
58.2%
|
(1.0)
|
|
Operating Margin
|
12.0%
|
13.6%
|
(1.5)
|
|
Net Margin
|
7.5%
|
8.7%
|
(1.2)
|
*Expressed in percentage points.
Margins are the earnings engine.
Balance Sheet Highlights
|
Assets
|
Q1 2008
|
Q1 2007
|
Change
|
|
Cash + ST Invest.
|
$463
|
$374
|
23.6%
|
|
Accounts Rec.
|
$316
|
$228
|
38.8%
|
|
Inventory
|
$581
|
$547
|
6.1%
|
|
Liabilities
|
Q1 2008
|
Q1 2007
|
Change
|
|
Accounts Payable
|
$341
|
$276
|
23.6%
|
|
Long-Term Debt
|
$550
|
$2
|
Big %
|
The balance sheet reflects the company's health.
Cash Flow Highlights
|
Q1 2008
|
Q1 2007
|
Change
|
|
Cash From Ops.
|
$808
|
$678
|
19.0%
|
|
Capital Expenditures
|
$264
|
$271
|
(2.6%)
|
|
Free Cash Flow
|
$544
|
$408
|
33.4%
|
|
Owner Earnings
|
$84
|
$51
|
67.0%
|
Free cash flow is a Fool's best friend.
Competitive Context
|
Market Cap
|
Trailing P/E Ratio
|
CAPS Rating (out of 5)
|
|
McDonald's (NYSE: MCD)
|
$60,660
|
26.53
|
****
|
|
Starbucks
|
$13,340
|
20.86
|
***
|
|
Panera Bread (Nasdaq: PNRA)
|
$1,150
|
19.9
|
***
|
|
Peet's Coffee & Tea (Nasdaq: PEET)
|
$304
|
42.03
|
***
|
|
Krispy Kreme Doughnuts (NYSE: KKD)
|
$180
|
N/A
|
*
|
Using the latest reported numbers from Yahoo!. Keep your partners close and the competition in your vest pocket.
Related Foolishness:
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