Starbucks (SBUX -0.35%) stock has done well for its long-term investors over its 30-year history, so new investors might think they've missed the coffee chain train. On this episode of "Ask Us Anything" on Motley Fool Live, recorded on March 18, Fool.com contributor Matt Frankel talks about why that's not necessarily the case and what new investors can likely expect from the holding.
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Matt Frankel: Starbucks, the way I look at it, I think of Starbucks in a similar context of why I own Berkshire Hathaway. It's a stock that could produce mild market-beating returns over the long run. It's not going to make you a millionaire overnight. It's not going to make you broke. It's a stock that you expect to do slightly better than the S&P 500, and Starbucks even kind of acknowledges that. In their annual meeting presentation, they say their target earnings growth going forward is 10 to 12%, slightly ahead of the S&P's historic returns, but not going to make you rich. It's a great core holding in your portfolio, which is, I think, to paraphrase, why Jamie owns it. Because it's just a great core holding that it could do slightly better than the market if they can execute. That's where I see Starbucks. I don't really think you need to time it as much. I'm generally not a fan of market timing at all. I don't think timing's important with Starbucks at all. I think this is something you buy and you just put away for 30 years as a core holding.
