Starbucks operates as a roaster, marketer, and retailer of specialty coffee, tea and other beverages and fresh food items worldwide. The company was founded in 1985 and is based in Seattle, Washington.
SBUX Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Starbucks Corp with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Starbucks Corp ranked in the 21th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 60.83%. The most interesting components of our discounted cash flow analysis for Starbucks Corp ended up being:
SBUX's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 29.05% of tickers in our DCF set.
Relative to other stocks in its sector (Consumer Cyclical), Starbucks Corp has a reliance on debt greater than only 18.54% of them.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Starbucks Corp? See ROL, VC, HOFT, RUBI, and LEVI.