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:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Starbucks Corp. To summarize, we found that Starbucks Corp ranked in the 0th percentile in terms of potential gain offered. We should note, though, that all scenearios modelled for this stock suggest it is overvalued. In terms of the factors that were most noteworthy in this DCF analysis for SBUX, they are:
The stock's equity weight, or the proportion of capital from equity relative to debt, is 83. Its equity weight surpasses that of 70.36% of free cash flow generating stocks in the Consumer Cyclical sector.
Its compound free cash flow growth rate, as measured over the past 5.55 years, is -0.42% -- higher than only 3.31% of stocks in our DCF forecasting set.
Starbucks Corp's weighted average cost of capital (WACC) is 8%; for context, that number is higher than merely 23.21% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Consumer Cyclical that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as SBUX, try BALY, BOMN, BURL, CAKE, and GLXZ.
What if getting vaccinated for Covid was as quick and easy as getting coffee at Starbucks? Starbucks is part of a group of Washington-based businesses, including Costco and Microsoft, working to improve the process. It even created a mock vaccination site at its headquarters.
Investors looking for exposure to the fast food and restaurant space may want to consider Domino's Pizza, Inc. (NYSE: DPZ ), McDonald's Corp (NYSE: MCD ), and Starbucks Corporation (NASDAQ: SBUX ), Goldman Sachs analysts said in a note that was subject of a recent CNBC "Trading Nation" segment . 'Can't Go Wrong': Commenting on Goldman's call on CNBC, Boris Schlossberg, managing director of FX strategy at BK Asset Management, said the three names have truly … Full story available on Benzinga.com