Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, specialty coffee giant Starbucks
With that in mind, let's take a closer look at Starbucks' business and see what CAPS investors are saying about the stock right now.
|Headquarters (Founded)||Seattle (1971)|
|Market Cap||$32.8 billion|
|Trailing-12-Month Revenue||$11.7 billion|
|Management||Founder/Chairman/CEO Howard Schultz
CFO Troy Alstead
|Return on Equity (Average, Past 3 Years)||24.4%|
|Cash/Debt||$2.05 billion / $550.9 million|
Sources: S&P Capital IQ and Motley Fool CAPS.
Earlier this fall, Berishtimes succinctly summed up the Starbucks bear case: " Too much competition + spread too thin = red [thumb]."
Starbucks currently sports a particularly lofty P/E of 27. That represents a premium to other large restaurant stocks like McDonald's (19), Tim Hortons (12), and Yum! Brands
CAPS member llgrout shows skepticism over Starbucks' recent growth initiative:
So their answer is to start selling alcohol ... nothing like admiting your current business model isn't working. Booze is very popular, so just turn all their coffee shops into bars, and problem solved. However, I think that folks who still go there want a coffee shop atmosphere, if they wanted a bar, they would go to a bar, so they are going to alienate some of their current customers. Also, if they over price their booze like they over price their coffee, they will continue to have the same problem they got now. Too much competition selling the same product at less.
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