Starbucks (SBUX) AI Stock Analysis

• Market Cap: $105.98B
• Dividend Yield: 2.62%
• Average Volume (3M): 9.68M
• Price to Earnings (P/E): 33.9
• Beta (1Y): 1.18
• Revenue Growth: -0.50%
• EPS Growth: -24.28%
• Country: US
• Employees: 361,000
• Sector: Consumer Cyclical
• Sector Strength: 58
• Industry: Restaurants
• EPS (TTM): 0.41
• Shares Outstanding: 1,136,400,000
• 10 Day Avg. Volume: 8,668,671
• 30 Day Avg. Volume: 9,684,809
• PEG Ratio: -3.07
• Price to Book (P/B): -17.33
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 33.32
• Enterprise Value/Market Cap: 1.10
• Enterprise Value/Revenue: 0.80
• Enterprise Value/Gross Profit: 12.83
• Enterprise Value/Ebitda: 4.19
• 1Y Price Target: $94.20
• Price Target Upside: 1.01% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 23

• Rating: 67 Neutral
• Price Target: $94.00 ▲(0.79%Upside)

Starbucks' overall score reflects strong revenue growth and effective cash flow management. However, high financial leverage, declining profit margins, and disappointing recent financial results weigh on the score. While strategic initiatives show promise, financial recovery is still in progress.

Positive Factors

Digital Membership Growth

Significant growth in its digital membership, with 90-day active customers growing to 75 million globally, shows growth potential for the future.

Innovation and Growth

SBUX continues to see a long runway for topline growth through innovation in beverages and food.

Staffing Strategy

The introduction of increased staffing through 'The Green Apron Service Model' is expected to provide a traffic lift in stores, favoring the bullish outlook on the stock.

Negative Factors

Competitive Pressure

Starbucks would likely face pressure on achieving sustainable profitability in the medium term due to growing economic headwinds and keen competition from fast-growing local coffee and tea chains.

Long-term Profitability Concerns

There is uncertainty about long-term profitability as sales are prioritized over margins in the turnaround strategy.

Valuation Concerns

Starbucks’ premium valuation against its peers might also reflect potential downside ahead.

Starbucks Business Overview & Revenue Model

Company Description

Starbucks Corporation, together with its subsidiaries, operates as a roaster, marketer, and retailer of specialty coffee worldwide. The company operates through three segments: North America, International, and Channel Development. Its stores offer coffee and tea beverages, roasted whole beans and ground coffees, single serve products, and ready-to-drink beverages; and various food products, such as pastries, breakfast sandwiches, and lunch items. The company also licenses its trademarks through licensed stores, and grocery and foodservice accounts. The company offers its products under the Starbucks, Teavana, Seattle's Best Coffee, Evolution Fresh, Ethos, Starbucks Reserve, and Princi brands. As of October 3, 2021, it operated 16,826 company-operated and licensed stores in North America; and 17,007 company-operated and licensed stores internationally. The company was founded in 1971 and is based in Seattle, Washington.

How the Company Makes Money

Starbucks primarily generates revenue through its company-operated stores, which account for a significant portion of its total earnings. These stores sell a variety of products including beverages, food items, and merchandise. Licensed stores also contribute to Starbucks' revenue through licensing fees and royalties for using the Starbucks brand. Additionally, Starbucks sells consumer packaged goods and ready-to-drink beverages through various channels including grocery stores, convenience stores, and other retail locations, further diversifying its revenue streams. The company's strategic partnerships, such as its collaboration with Nestlé to distribute Starbucks-branded products globally, also play a crucial role in expanding its market presence and enhancing revenue growth.

Starbucks Financial Statement Overview

Summary

Starbucks shows strong revenue growth and cash flow generation. However, high leverage and declining net profit margins indicate financial risks. The company must improve profitability and reduce financial leverage to enhance stability.

Income Statement

Starbucks demonstrates strong revenue growth with a 12.7% increase in total revenue from 2022 to TTM (Trailing-Twelve-Months). The gross profit margin is robust at 36.5% for the TTM, indicating efficient cost management. However, the net profit margin has slightly decreased to 8.6% in TTM, reflecting potential challenges in controlling non-operating expenses. The EBIT margin is solid at 12.5%, but slightly down from previous periods, suggesting a need to enhance operational efficiency. Overall, the income statement shows a healthy top-line growth but slight pressure on profitability margins.

Balance Sheet

Starbucks’ balance sheet reflects high leverage with a negative stockholders' equity of $7.6 billion in TTM, indicating a debt-heavy capital structure. The debt-to-equity ratio is not calculable due to negative equity, emphasizing the financial risk. Despite this, the company maintains a stable asset base of $31.6 billion, demonstrating resilience. The equity ratio is negative, highlighting potential vulnerability. While Starbucks manages its assets well, the high leverage poses a significant risk to financial stability.

Cash Flow

Starbucks shows strong cash flow generation with operating cash flow of $5.28 billion in TTM and a healthy free cash flow of $3.06 billion. The free cash flow to net income ratio is high, indicating efficient cash conversion. However, a decline in operating cash flow compared to the previous year suggests the need for improved cash management. Despite minor fluctuations, the company's cash flow remains strong, supporting its operational needs and capital expenditure.

Breakdown
TTM	Sep 2024	Dec 2023	Dec 2022	Dec 2021	Sep 2020
Income Statement		Total Revenue
36.35B	36.18B	35.98B	32.25B	29.06B	23.52B
	Gross Profit
9.07B	9.71B	9.85B	8.37B	8.39B	5.06B
	EBIT
4.55B	5.41B	5.87B	4.62B	4.87B	1.56B
	EBITDA
6.33B	7.12B	7.40B	6.24B	7.35B	3.10B
	Net Income Common Stockholders
3.13B	3.76B	4.12B	3.28B	4.20B	928.30M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
3.01B	3.54B	3.95B	3.18B	6.62B	4.63B
	Total Assets
31.63B	31.34B	29.45B	27.98B	31.39B	29.37B
	Total Debt
26.01B	25.80B	24.60B	23.80B	23.61B	25.26B
	Net Debt
23.34B	22.52B	21.05B	20.99B	17.15B	20.91B
	Total Liabilities
39.25B	38.78B	37.43B	36.68B	36.71B	37.17B
	Stockholders Equity
-7.62B	-7.45B	-7.99B	-8.71B	-5.32B	-7.81B
Cash Flow		Free Cash Flow
2.77B	3.32B	3.68B	2.56B	4.52B	114.20M
	Operating Cash Flow
5.57B	6.10B	6.01B	4.40B	5.99B	1.60B
	Investing Cash Flow
-2.93B	-2.70B	-2.27B	-2.15B	-319.50M	-1.71B
	Financing Cash Flow
-2.72B	-3.72B	-2.99B	-5.64B	-3.65B	1.71B

Starbucks Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 93.26
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SBUX, the sentiment is Positive. The current price of 93.26 is above the 20-day moving average (MA) of 87.49, above the 50-day MA of 84.74, and below the 200-day MA of 94.61, indicating a neutral trend. The MACD of 2.18 indicates Negative momentum. The RSI at 63.09 is Neutral, neither overbought nor oversold. The STOCH value of 86.80 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SBUX.

Starbucks Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
YUMC	78 Outperform	$16.27B	18.25	15.73%	2.20%	2.79%	19.36%
TXRH	76 Outperform	$12.09B	28.11	33.55%	1.49%	15.09%	31.24%
BROS	75 Outperform	$11.74B	176.90	8.57%	―	30.42%	108.41%
MCD	71 Outperform	$216.77B	26.63	-216.57%	2.35%	-0.22%	-3.83%
SBUX	67 Neutral	$105.98B	33.90	-47.07%	2.62%	-0.50%	-24.28%
YUM	66 Neutral	$40.02B	28.71	-19.43%	1.97%	10.09%	-11.50%
Sector *	62 Neutral	$6.82B	11.05	2.80%	4.32%	2.67%	-24.92%

Starbucks Corporate Events

Starbucks Appoints Mike Grams as COO

On June 4, 2025, Starbucks Corporation announced the appointment of Mike Grams as the new Chief Operating Officer, reinstating the position within its executive leadership team. This strategic move aims to enhance leadership accountability and operational efficiency by consolidating global coffeehouse development and supply chain under Grams’ oversight. Additionally, the company is undergoing organizational changes to strengthen its focus on sustainability and brand integration, with key leadership roles being restructured to accelerate progress towards its business goals. The departure of Brad Lerman, the Chief Legal Officer, was also announced, with a search for his successor underway.

The most recent analyst rating on (SBUX) stock is a Sell with a $76.00 price target. To see the full list of analyst forecasts on Starbucks stock, see the SBUX Stock Forecast page.

Starbucks Completes $1.75 Billion Senior Notes Offering

On May 8, 2025, Starbucks completed a public offering of senior notes totaling $1.75 billion, consisting of $750 million due in 2028, $500 million due in 2030, and $500 million due in 2035. This move is likely to impact the company’s financial strategy by providing additional capital, while the notes will rank equally with other senior unsecured debts and are subject to standard covenants and events of default.