Added to YB: 2026-05-14
Pitch date: 2026-05-12
SBUX [bearish]
Starbucks Corporation
Author Info
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Company Info
Starbucks Corporation, together with its subsidiaries, operates as a roaster, marketer, and retailer of coffee internationally.
Market Cap
$120.8B
Pitch Price
N/A
Price Target
60.00 (-44%)
Dividend
2.34%
EV/EBITDA
15.98
P/E
80.86
EV/Sales
3.73
Sector
Hotels, Restaurants and Leisure
Category
turnaround
Starbucks ($SBUX): A Turnaround Priced to Perfection, or a True Recovery?
SBUX (short): Trading at 80x earnings despite Q2 operating margin of 9.9% (vs 18% in 2024). $500M staffing investment + sticky labor costs pressuring margins. Niccol's turnaround boosted US comp sales +7.1% but at significant margin cost. Even hitting bullish $4 EPS by 2028, stock trades 27x vs peers at 15-25x. Base case: -45.8% downside to $60 target on 30x 2028 earnings. Risks: continued positive momentum, faster margin recovery, stronger international growth, rising consumer spending.
Read full article (11 min)