Thanks for the nice write up. Didn't cover Starbucks myself yet, but great to read about the extended opening hours. What I don't like is the heavy share buyback from the past years, financed with debt. With higher interest rates it would make sense for me to first pay down debt. Also the new CEO raises some doubt and prices for coffee are at the top where some customers think it has become too expensive ($6,50 for a latte). Based on your article, will have a deeper look. Don't think it's very cheap because of the lower growth, but you're right that the brand is extremely strong. Thanks again!
I fully agree! If there is something I dislike, it is most definitely share buybacks funded by debt or at ridiculous levels. In this situation, I agree buybacks don't make much sense considering its debt position.
The CEO still has to prove himself, and so far, he hasn't really inspired confidence. I have my doubts, but I will give him some to consider before judging. The new C-suite structure could help him a bit.
I enjoyed this piece. I didn't look into $SBUX earnings, so this was a good summary of the fundamentals. Technical chart looks oversold and approaching 2022 lows. Should bounce, however if that 2022 low breaks down, something more structurally with the GLOBAL consumer may have changed with paying premium for a coffee. In Manhattan, even with the work crowd tue/wed, the locations here are less crowded. But I am by wall st. I am sure midtown is busier just by nature of concentration of commuters. PS I switched to a Nespresso machine years ago. It tastes better and is only 70 cents per cup. So much so I can't bring myself to pay $9 anywhere. Give it a taste test. Cheers ☕️
Thanks for the comment! Interesting insights right here! I haven't really noticed a significant decline in traffic across New York, but I can't say I am monitoring it closely, and I tend to visit many different locations. But yes, a good machine at home is worth the investment for sure!
1 other comment I also want to make after looking at the chart is there are many trapped above and now down 15-25% depending on entry timing. Pt being as we rally there may be some supply overhead.
I am not a coffee drinker, but I am always fascinated to see that every Starbucks I pass is crowded and somehow people love this expensive coffee. I am invested and also agree with the view that the long-term investment thesis is still good.
Hey, thanks for commenting! Could you elaborate? I am currently projecting potential returns exceeding 20% until fiscal FY26. Based on current data and insights, this should stay pretty solid after 2026 as well, though making predictions further into the future is tough.
Starbucks is one of the few examples where I appreciate the business and its operations, but doesn’t like the product. Or at least, I haven’t been to a Starbucks with good coffee😊
Thanks for sharing your view on the situation. I agree that the moat might not be as strong as it has been but the brand power and its global reach do still give it an edge. Positively, it also remains one of the top brands among Gen Z, which should bode well.
I agree with your thesis, and if SBUX fits your investment strategy, it could definitely be a value play. There's just to much uncertainty for me to consider it, even though I like the brand and especially the coffee. :P
I expanded upon the idea! All Starbucks needs to do to save their business model is to add a new type of coffee … the Mushroom Blends … and when that thing happens after this date, I wanna know who was the thinker of that thought. And shake their hand. Because I don’t know who to contact at Starbucks to give them this idea. But I think I’m on something. They should start carrying that as well as the new adaptogen drinks, that reduce your need for alcohol.
Thanks for the nice write up. Didn't cover Starbucks myself yet, but great to read about the extended opening hours. What I don't like is the heavy share buyback from the past years, financed with debt. With higher interest rates it would make sense for me to first pay down debt. Also the new CEO raises some doubt and prices for coffee are at the top where some customers think it has become too expensive ($6,50 for a latte). Based on your article, will have a deeper look. Don't think it's very cheap because of the lower growth, but you're right that the brand is extremely strong. Thanks again!
I fully agree! If there is something I dislike, it is most definitely share buybacks funded by debt or at ridiculous levels. In this situation, I agree buybacks don't make much sense considering its debt position.
The CEO still has to prove himself, and so far, he hasn't really inspired confidence. I have my doubts, but I will give him some to consider before judging. The new C-suite structure could help him a bit.
I look forward to your post!
I enjoyed this piece. I didn't look into $SBUX earnings, so this was a good summary of the fundamentals. Technical chart looks oversold and approaching 2022 lows. Should bounce, however if that 2022 low breaks down, something more structurally with the GLOBAL consumer may have changed with paying premium for a coffee. In Manhattan, even with the work crowd tue/wed, the locations here are less crowded. But I am by wall st. I am sure midtown is busier just by nature of concentration of commuters. PS I switched to a Nespresso machine years ago. It tastes better and is only 70 cents per cup. So much so I can't bring myself to pay $9 anywhere. Give it a taste test. Cheers ☕️
Thanks for the comment! Interesting insights right here! I haven't really noticed a significant decline in traffic across New York, but I can't say I am monitoring it closely, and I tend to visit many different locations. But yes, a good machine at home is worth the investment for sure!
1 other comment I also want to make after looking at the chart is there are many trapped above and now down 15-25% depending on entry timing. Pt being as we rally there may be some supply overhead.
I am not a coffee drinker, but I am always fascinated to see that every Starbucks I pass is crowded and somehow people love this expensive coffee. I am invested and also agree with the view that the long-term investment thesis is still good.
Thanks for stopping by an replying! Let's hope this one works out the way we see it.
Did you mean 20% CAGR? If yes, for what period of time?
Hey, thanks for commenting! Could you elaborate? I am currently projecting potential returns exceeding 20% until fiscal FY26. Based on current data and insights, this should stay pretty solid after 2026 as well, though making predictions further into the future is tough.
Starbucks has it is well-known brand and a huge company, however I don’t like how they been losing operating cash flow in the recent years.
However I still have Starbucks in my portfolio let’s see what happens in the following quarters and years
Thanks for sharing!
My time at Stratton Oakmont (The Wolf Of Wall Street) https://open.substack.com/pub/michael880/p/another-chapter-from-can-i-have-your?r=3b6pw1&utm_campaign=post&utm_medium=web
Starbucks is one of the few examples where I appreciate the business and its operations, but doesn’t like the product. Or at least, I haven’t been to a Starbucks with good coffee😊
I appreciate the comment; thanks! I quite like the coffee, actually, or at least here in New York.
I don't mind bad quarters, but for me the moat is dying. The product just doesn't offer the value for the price it demands.
Thanks for sharing your view on the situation. I agree that the moat might not be as strong as it has been but the brand power and its global reach do still give it an edge. Positively, it also remains one of the top brands among Gen Z, which should bode well.
Time will tell!
I agree with your thesis, and if SBUX fits your investment strategy, it could definitely be a value play. There's just to much uncertainty for me to consider it, even though I like the brand and especially the coffee. :P
I can see where you are coming from. The thesis certainly isn't as straightforward as it was for most of the last decade. Thanks for the comment!
Absolutely not a buy. Worth spending your money into small coffee shop.
Thanks for sharing your view! Time will tell.
All Starbucks needs to do to save their business model is to add a new type of coffee … the Mushroom Blends
That's an interesting take.
I expanded upon the idea! All Starbucks needs to do to save their business model is to add a new type of coffee … the Mushroom Blends … and when that thing happens after this date, I wanna know who was the thinker of that thought. And shake their hand. Because I don’t know who to contact at Starbucks to give them this idea. But I think I’m on something. They should start carrying that as well as the new adaptogen drinks, that reduce your need for alcohol.