close
這是上財務會計時做出來的玩意，寫那麼辛苦只為那區區5%，真是不值得，所以就把它貼上來了。基本上每個人分析的方法都不大一樣，我是不大會去管財報上一項一項的小細節，只管整體的比例分析跟未來股價的位置而已。
BUSINESS SUMMARY:
Starbucks purchases, roasts, and sells whole bean coffees along with brewed coffees, Italian-style espresso beverages, cold blended beverages, complementary food items, coffee-related accessories and equipment, a selection of teas and a line of compact discs, primarily through Company-operated retail stores. It also produces and sells bottled Frappuccino and DoubleShot coffee and a line of ice creams. As of Oct. 2nd 2005, it operated a total of 10,241 stores, including 6,000 Company-operated stores and 4,241 licensed stores.
COMPANY INFORMATION:
Chief Global Strategist: Howard Schultz
Chief Executive Officer: Orin C. Smith
Auditor: Deloitte & Touche LLP
Legal Counsel: Preston Thorgrimson Shidler Gates & Ellis
Principal Offices:
2401 Utah Avenue South
Seattle, WA 98134 United States
COMPETITORS:
The Company’s primary competitors are restaurants, specialty coffee shops, and doughnut shops for coffee beverage sales; the Company’s whole bean coffee sales compete directly against specialty coffees sold through supermarkets, specialty retailers, franchise operators, and specialty coffee stores.
The beverage market is currently highly fragmented and competitive and the Company encounters competitors from various countries due to its global expansion. Nonetheless, no companies currently are able to threat Starbucks’ position and slow down its expansion pace. Several major competitors in year 2005 are listed below:
The business scale of the Company’s competitors is much smaller and the revenues of the Company are 10.8 times higher than the sum of all six competitors. As a result, Starbucks, even though has many small competitors, is performing like a monopoly in the coffee beverage market.
PROFITABILITY ASSESSMENT:
The Company has average performance in its coffee retail business since its operating margin is about the same as the industrial average. However, through its high interest income, Starbucks boosts its revenue and outperform the industry average comparing their net profit. The ROI of the Company is 6.9 times higher than industry and 1.6 times higher than McDonald, the leading firm in global food service industry. This indicates that Starbucks is able to generate more cash than other firms using the same amount of money.
The Company has two departments, US and international. In the past, Starbucks focus on US business, which contributed 4.1 times more operating income than international business in 2001. Recently, the Company gradually develops its business in various countries, mainly China. In 2005, US department only generates 2.1 times more operating income than international department. Unlike McDonald, Starbucks is a relatively new company and has many undeveloped market. In the future, as the Company expands, international business may outperform US business.
LIQUIDITY ASSESSMENT:
In comparison to industry, the Company has slightly smaller quick ratio and current ratio and a significant smaller working capital per total assets ratio. Smaller liquidity indicators reveal the fact that the Company is more risky to invest since it has higher liability than current assets. The Company may not be able to collect enough cash to revolve under emergency condition.
However, lower ratios can also be an indication of stable company financial condition and steady growth. As a franchise company, Starbucks is able to expand its business by providing licenses and training to individuals who are willing to operate a Starbucks retail store. Limiting the amount of current asset and maintaining low amount of cash allow the Company to invest cash to other places to generate more cash flow.
From the performance of McDonald, it has relatively lower quick ratio and current ratio. The negative working capital shows that it has lesser current assets than current liabilities. The leading performance of McDonald justifies that maintaining a lower liquidity ratio for a stabilized business is not necessarily a bad thing. The Company has an ROA of 9.90 in average, which outperforms both the industry average and McDonald, but only has an operating margin of 10.52%. Thus, low liquidity ratios may imply efficient usage of current assets for investment.
DEBT MANAGEMENT:
The Company has been managing its debt at a comparatively low level. The dependence of investor financing is indicated by the 31% higher current liabilities per equity ratio than McDonald. Although financed by investors avoid paying interest for debt, if the Company is growing at a faster rate than debt interest rate, borrowing money is actually beneficial to the Company and also save the Company some tax. However, since the operating margin of the Company only increases 3.98% annually and the Company already has low liquidity ratio, owning a large amount of debt would be very risky regard to the Company’s current financial condition.
ASSET MANAGEMENT:
The company shows an extremely efficient usage of its asset by generating 1.51 times revenues than the value of assets owned, which is 2.3 times better than the performance of McDonald. The big negative figure of revenues per working capital reveals the fact that small amount of current asset is used to generate large amount of revenues. Notice that the Company has almost zero debt. Since there is no debt, no interest is required to be paid and thus the interest coverage ratio is non-applicable.
STOCK ANALYSIS:
In the past 7 year performance of the company, its EPS has been increased by 12.28% annually since 1999. As a result, after 3 years, EPS will be expected to be at around $0.89. Since the P/E growth rate is 9.26%, the expected P/E after 3 years should be 51.86. Thus the expected market price per share should be around $46.16.
Current market price of the Company is $35.295 at November 30th, 2006. Comparing to the average P/E ratio of industry, which is about 30.70, current market price is 1.3 times overestimated than average. A reasonable estimate of current price would be around $27.25. As a result, current price is not a favorable purchasing price.
Considering the 3-year treasury securities in US, its rate of return ranges from 4.29 ~ 5.28%. Comparing the growth rate of market price from November 1999 ($26.69) to November 2006 ($37.99), the rate is only about 5.1% per year, which is very similar to that of 3-year securities. Market price should fall around $44.10. Although the company has outperformed Dow Jones, S&P500, and Nasdaq indices in the past 10 years, recent low growth rate makes it unattractive, especially to Canadian investors.
Due to the high trade deficit in US, in the long run, the exchange rate of US dollar will gradually drop. In the past one year, the US:CAD ranges from 1.1735 to 1.0991, a maximum difference of 6.5%. Since the company is focusing its business on foreign country, especially China, the profit from international department may be higher than expected in the future due to exchange rate, but such increment may not affect its stock price too much and more likely to be diluted by the negative exchange rate impact for Canadian investors.
CONCLUSION:
The company shows very strong control on its asset usage efficiency and its growth is stabilized and predictable with minor degree of risk. The stocks of the Company may provide an average return that is higher than saving money in bank or purchasing treasury securities. Nonetheless, it would not grow aggressively like Google. Also, notice that the Company has never given out any dividends in the past. The market price of Starbucks would fall in the range of $44.10 ~ $46.16 after 3 years. Maximum percentage of return is 21.5% or 6.7% annually. We suggest finding a better investing target than Starbucks.
BUSINESS SUMMARY:
Starbucks purchases, roasts, and sells whole bean coffees along with brewed coffees, Italian-style espresso beverages, cold blended beverages, complementary food items, coffee-related accessories and equipment, a selection of teas and a line of compact discs, primarily through Company-operated retail stores. It also produces and sells bottled Frappuccino and DoubleShot coffee and a line of ice creams. As of Oct. 2nd 2005, it operated a total of 10,241 stores, including 6,000 Company-operated stores and 4,241 licensed stores.
COMPANY INFORMATION:
Chief Global Strategist: Howard Schultz
Chief Executive Officer: Orin C. Smith
Auditor: Deloitte & Touche LLP
Legal Counsel: Preston Thorgrimson Shidler Gates & Ellis
Principal Offices:
2401 Utah Avenue South
Seattle, WA 98134 United States
COMPETITORS:
The Company’s primary competitors are restaurants, specialty coffee shops, and doughnut shops for coffee beverage sales; the Company’s whole bean coffee sales compete directly against specialty coffees sold through supermarkets, specialty retailers, franchise operators, and specialty coffee stores.
The beverage market is currently highly fragmented and competitive and the Company encounters competitors from various countries due to its global expansion. Nonetheless, no companies currently are able to threat Starbucks’ position and slow down its expansion pace. Several major competitors in year 2005 are listed below:
The business scale of the Company’s competitors is much smaller and the revenues of the Company are 10.8 times higher than the sum of all six competitors. As a result, Starbucks, even though has many small competitors, is performing like a monopoly in the coffee beverage market.
PROFITABILITY ASSESSMENT:
The Company has average performance in its coffee retail business since its operating margin is about the same as the industrial average. However, through its high interest income, Starbucks boosts its revenue and outperform the industry average comparing their net profit. The ROI of the Company is 6.9 times higher than industry and 1.6 times higher than McDonald, the leading firm in global food service industry. This indicates that Starbucks is able to generate more cash than other firms using the same amount of money.
The Company has two departments, US and international. In the past, Starbucks focus on US business, which contributed 4.1 times more operating income than international business in 2001. Recently, the Company gradually develops its business in various countries, mainly China. In 2005, US department only generates 2.1 times more operating income than international department. Unlike McDonald, Starbucks is a relatively new company and has many undeveloped market. In the future, as the Company expands, international business may outperform US business.
LIQUIDITY ASSESSMENT:
In comparison to industry, the Company has slightly smaller quick ratio and current ratio and a significant smaller working capital per total assets ratio. Smaller liquidity indicators reveal the fact that the Company is more risky to invest since it has higher liability than current assets. The Company may not be able to collect enough cash to revolve under emergency condition.
However, lower ratios can also be an indication of stable company financial condition and steady growth. As a franchise company, Starbucks is able to expand its business by providing licenses and training to individuals who are willing to operate a Starbucks retail store. Limiting the amount of current asset and maintaining low amount of cash allow the Company to invest cash to other places to generate more cash flow.
From the performance of McDonald, it has relatively lower quick ratio and current ratio. The negative working capital shows that it has lesser current assets than current liabilities. The leading performance of McDonald justifies that maintaining a lower liquidity ratio for a stabilized business is not necessarily a bad thing. The Company has an ROA of 9.90 in average, which outperforms both the industry average and McDonald, but only has an operating margin of 10.52%. Thus, low liquidity ratios may imply efficient usage of current assets for investment.
DEBT MANAGEMENT:
The Company has been managing its debt at a comparatively low level. The dependence of investor financing is indicated by the 31% higher current liabilities per equity ratio than McDonald. Although financed by investors avoid paying interest for debt, if the Company is growing at a faster rate than debt interest rate, borrowing money is actually beneficial to the Company and also save the Company some tax. However, since the operating margin of the Company only increases 3.98% annually and the Company already has low liquidity ratio, owning a large amount of debt would be very risky regard to the Company’s current financial condition.
ASSET MANAGEMENT:
The company shows an extremely efficient usage of its asset by generating 1.51 times revenues than the value of assets owned, which is 2.3 times better than the performance of McDonald. The big negative figure of revenues per working capital reveals the fact that small amount of current asset is used to generate large amount of revenues. Notice that the Company has almost zero debt. Since there is no debt, no interest is required to be paid and thus the interest coverage ratio is non-applicable.
STOCK ANALYSIS:
In the past 7 year performance of the company, its EPS has been increased by 12.28% annually since 1999. As a result, after 3 years, EPS will be expected to be at around $0.89. Since the P/E growth rate is 9.26%, the expected P/E after 3 years should be 51.86. Thus the expected market price per share should be around $46.16.
Current market price of the Company is $35.295 at November 30th, 2006. Comparing to the average P/E ratio of industry, which is about 30.70, current market price is 1.3 times overestimated than average. A reasonable estimate of current price would be around $27.25. As a result, current price is not a favorable purchasing price.
Considering the 3-year treasury securities in US, its rate of return ranges from 4.29 ~ 5.28%. Comparing the growth rate of market price from November 1999 ($26.69) to November 2006 ($37.99), the rate is only about 5.1% per year, which is very similar to that of 3-year securities. Market price should fall around $44.10. Although the company has outperformed Dow Jones, S&P500, and Nasdaq indices in the past 10 years, recent low growth rate makes it unattractive, especially to Canadian investors.
Due to the high trade deficit in US, in the long run, the exchange rate of US dollar will gradually drop. In the past one year, the US:CAD ranges from 1.1735 to 1.0991, a maximum difference of 6.5%. Since the company is focusing its business on foreign country, especially China, the profit from international department may be higher than expected in the future due to exchange rate, but such increment may not affect its stock price too much and more likely to be diluted by the negative exchange rate impact for Canadian investors.
CONCLUSION:
The company shows very strong control on its asset usage efficiency and its growth is stabilized and predictable with minor degree of risk. The stocks of the Company may provide an average return that is higher than saving money in bank or purchasing treasury securities. Nonetheless, it would not grow aggressively like Google. Also, notice that the Company has never given out any dividends in the past. The market price of Starbucks would fall in the range of $44.10 ~ $46.16 after 3 years. Maximum percentage of return is 21.5% or 6.7% annually. We suggest finding a better investing target than Starbucks.
全站熱搜
留言列表
金融法律 (3)