In the following video, Fool analysts Jeremy Phillips and Austin Smith talk about why they see Starbucks (NASDAQ: SBUX ) as a buy.
Jeremy just recently purchased shares of Starbucks based on a recommendation from the Fool's Supernova service, and it's one of the few bricks-and-mortar stores he says he'd consider owning. It comes down to consumables: Starbucks sells products that people buy every day -- products they see as essential as napkins or toilet paper, he says.
That means Starbucks offers the safety of a consumer brand such as Procter & Gamble (NYSE: PG ) , but with 10% growth.
The stock sells at about 30 times earnings, which may seem like a lot for a company that has so saturated the U.S. market, Austin says. But Starbucks has expanded into different areas, including baked goods, single-serve coffee brewers, and energy drinks. That's given Starbucks, already a very strong brand, many new avenues for possible growth.
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