Starbucks (SBUX) AI Stock Analysis

• Market Cap: $100.44B
• Dividend Yield: 2.88%
• Average Volume (3M): 9.44M
• Price to Earnings (P/E): 54.2
• Beta (1Y): 1.16
• Revenue Growth: 2.80%
• EPS Growth: -50.71%
• Country: US
• Employees: 361,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 0.52
• Shares Outstanding: 1,137,100,000
• 10 Day Avg. Volume: 10,770,530
• 30 Day Avg. Volume: 9,439,998
• PEG Ratio: -1.02
• Price to Book (P/B): -11.91
• Price to Sales (P/S): 2.59
• P/FCF Ratio: 39.49
• Enterprise Value/Market Cap: 1.18
• Enterprise Value/Revenue: 3.18
• Enterprise Value/Gross Profit: 13.89
• Enterprise Value/Ebitda: 21.64
• 1Y Price Target: $95.00
• Price Target Upside: 10.25% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 21
• EPS Forecast (FY): 2.38
• Revenue Forecast (FY): $38.33B

• Rating: 56 Neutral
• Price Target: $88.00 ▲(2.12% Upside)

Starbucks' overall stock score is driven by strong revenue growth and positive earnings call sentiment. However, high leverage, declining profitability margins, and a high valuation weigh on the score. Technical indicators suggest a bearish trend, adding to the cautious outlook.

Positive Factors

International Expansion

Starbucks' continued international expansion, with a record $2.1 billion in international revenues, strengthens its global market presence and diversifies revenue streams, providing long-term growth opportunities.

Revenue Growth

Consistent revenue growth indicates robust market demand and effective business strategies, enhancing Starbucks' ability to invest in future initiatives and maintain competitive positioning.

Joint Venture in China

The joint venture with Boyu Capital aims to expand Starbucks' footprint in China, leveraging local expertise to enhance market penetration and customer experience, crucial for long-term growth in a key market.

Negative Factors

High Leverage

High leverage with negative equity poses financial risks, potentially limiting Starbucks' ability to invest in growth initiatives and increasing vulnerability to economic downturns.

Declining Profit Margins

Declining profit margins due to inflation and investments indicate cost pressures, which can impact Starbucks' profitability and ability to sustain long-term financial health.

Regulatory Settlement

The significant settlement for labor law violations highlights potential regulatory challenges and reputational risks, which could affect Starbucks' operational stability and employee relations.

Starbucks Business Overview & Revenue Model

Company Description

Starbucks Corporation (SBUX) is a global coffeehouse chain headquartered in Seattle, Washington. Founded in 1971, Starbucks has grown to become a leading retailer and roaster of specialty coffee, operating thousands of stores worldwide. The company primarily operates in the food and beverage sector, offering a diverse range of products including brewed coffee, espresso beverages, teas, fresh food items, and merchandise such as coffee beans and brewing equipment. Beyond its retail stores, Starbucks also engages in the sale of packaged coffee and tea products through grocery channels and has established a significant presence in the digital space with its mobile app and loyalty programs.

How the Company Makes Money

Starbucks primarily generates revenue through the sale of food and beverages across its retail stores, with a significant portion coming from its specialty coffee drinks. The company also earns money through merchandise sales, including coffee beans, equipment, and packaged food items. Additionally, Starbucks has a robust loyalty program, Starbucks Rewards, which encourages repeat business and increases customer engagement. The company benefits from strategic partnerships, such as those with Nestlé for global coffee products distribution, and with various food suppliers to enhance its menu offerings. Moreover, Starbucks leverages its digital platforms, including mobile ordering and payments, to streamline operations and improve customer convenience, contributing to higher sales volumes. The company also explores international markets, expanding its footprint and revenue potential outside the United States.

Starbucks Financial Statement Overview

Summary

Starbucks shows strong revenue growth but faces declining profitability margins, indicating cost pressures. The balance sheet reveals high leverage with negative equity, posing financial risks. Cash flow generation has improved, but operational cash flow efficiency has decreased.

Income Statement

Starbucks has shown a strong revenue growth rate of 34.65% in the latest year, indicating a robust recovery and expansion. However, the gross profit margin has decreased from previous years, and the net profit margin has also declined, suggesting increased costs or pricing pressures. The EBIT and EBITDA margins have similarly decreased, reflecting challenges in maintaining operational efficiency.

Balance Sheet

The balance sheet reveals a negative stockholders' equity, leading to a high and negative debt-to-equity ratio, which poses a significant financial risk. Return on equity is negative, indicating losses relative to equity. The equity ratio is also negative, highlighting a leveraged position that could be concerning if not managed carefully.

Cash Flow

Operating cash flow has decreased, and the free cash flow growth rate is positive at 61.06%, showing improvement in cash generation. However, the operating cash flow to net income ratio has decreased, indicating less cash flow relative to net income. The free cash flow to net income ratio remains moderate, suggesting some stability in cash flow management.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	37.18B	37.18B	36.18B	35.98B	32.25B	29.06B
Gross Profit	8.52B	8.98B	9.71B	9.85B	8.37B	8.39B
EBITDA	5.47B	5.38B	7.12B	7.40B	6.24B	7.35B
Net Income	1.86B	1.86B	3.76B	4.12B	3.28B	4.20B
Balance Sheet
Total Assets	32.02B	32.02B	31.34B	29.45B	27.98B	31.39B
Cash, Cash Equivalents and Short-Term Investments	3.47B	3.47B	3.54B	3.95B	3.18B	6.62B
Total Debt	26.61B	26.61B	25.80B	24.60B	23.80B	23.61B
Total Liabilities	40.11B	40.11B	38.78B	37.43B	36.68B	36.71B
Stockholders Equity	-8.10B	-8.10B	-7.45B	-7.99B	-8.71B	-5.32B
Cash Flow
Free Cash Flow	2.44B	2.44B	3.32B	3.68B	2.56B	4.52B
Operating Cash Flow	4.75B	4.75B	6.10B	6.01B	4.40B	5.99B
Investing Cash Flow	-2.49B	-2.49B	-2.70B	-2.27B	-2.15B	-319.50M
Financing Cash Flow	-2.30B	-2.30B	-3.72B	-2.99B	-5.64B	-3.65B

Starbucks Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 86.17
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 86.17 is above the 20-day moving average (MA) of 85.48, above the 50-day MA of 84.33, and below the 200-day MA of 86.79, indicating a neutral trend. The MACD of 0.71 indicates Negative momentum. The RSI at 52.64 is Neutral, neither overbought nor oversold. The STOCH value of 69.77 is Neutral, 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
DRI	76 Outperform	$22.08B	19.90	54.10%	3.06%	8.61%	9.39%
QSR	75 Outperform	$31.86B	24.97	28.08%	3.53%	16.82%	-29.91%
CMG	73 Outperform	$49.77B	33.42	44.96%	―	7.31%	5.26%
MCD	65 Neutral	$224.93B	26.94	―	2.27%	1.26%	2.87%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
YUM	59 Neutral	$42.69B	29.94	―	1.83%	11.60%	-4.33%
SBUX	56 Neutral	$100.44B	54.23	―	2.88%	2.80%	-50.71%

Starbucks Corporate Events

Starbucks Forms Joint Venture with Boyu Capital in China

On November 3, 2025, Starbucks announced a joint venture with Boyu Capital, where Boyu will acquire up to a 60% interest in Starbucks’ retail operations in China. This strategic partnership aims to accelerate Starbucks’ growth in China, leveraging Boyu’s local expertise to expand into new cities and regions, while Starbucks retains a 40% interest and continues to own and license its brand. The venture is expected to enhance Starbucks’ market presence and customer experience in China, with plans to increase the number of stores from 8,000 to 20,000, reflecting a significant milestone in Starbucks’ 26-year journey in the region.

Starbucks Announces Major Restructuring Plan

On September 23, 2025, Starbucks announced a restructuring plan under its ‘Back to Starbucks’ strategy, which involves closing certain coffeehouses and transforming its support organization. This initiative aims to revitalize the brand by enhancing the customer experience and ensuring financial performance. The company plans to close stores that do not meet brand and financial criteria, impacting its North American operations significantly. Starbucks estimates restructuring costs of approximately $1 billion, with a majority of expenses related to North America, including employee separation benefits and lease costs. The company expects to complete most closures by the end of the fiscal year, with a slight decline in its North American store count. The restructuring is intended to build a stronger, more resilient Starbucks, with plans to uplift over 1,000 locations and reduce non-retail partner roles to focus on customer service and growth.