Starbucks hosted shareholders at its 32nd annual meeting. Speakers at this annual meeting included CEO Laxman Narashimhan, Executive Vice President Brand Lerman and Independent Chairwoman Mellody Hobson. As part of their opening remarks, both Hobson and Narasimhan revealed the outlook for this year, for which they shared their optimism for long-term and steady growth. Despite the coffee giant’s stock being down 7% YTD, Starbucks is still very successful thanks to its many innovations that will ensure continued dynamic growth in the future. The Starbucks brand not only has significant pricing power, but also differentiates itself with its product offerings from its competitors. Investors cannot ignore how Starbucks is steadily financially successful. Over the past decade, the company’s annual operating margin has averaged 14.9%, resulting in consistent profitability. Starbucks produced $6 billion in operating cash flow for fiscal year 2023. Management directs this capital toward dividends and share repurchases. And what has helped Starbucks maintain such a strong position in this competitive foodservice industry? It’s largely due to its focus on bolstering its digital support. No other restaurant chain does this better than Starbucks. The company boasts 34.3 million active members in the U.S., where it collects comprehensive data that it uses as it targets marketing campaigns to advertise through its consumers. Starbucks also had the most recent fiscal read
Founded on March 31, 1971, Starbucks Corporation (NASDAQ-SBUX) is an international coffee manufacturer and the world’s largest commercial coffeehouse chain. The company is headquartered in Seattle, Washington, USA. This largest chain operates 35,711 coffee shops in 80 countries. Of these, over 15,000 are located in the USA, nearly 2,000 in China, more than 1,500 in Canada, more than 1,000 in Japan and more than 900 in the UK. The company sells drip coffee, espresso, hot drinks, other hot and cold drinks, roasted coffee, salads, hot and cold sandwiches, pastries, snacks, and cups or mugs. It also sells books, music, and movies in its entertainment division through its record label, Hear Music. Many products are offered seasonally or with respect to branch location. In the US, Starbucks ice creams and coffees are also available in convenience stores. Since its founding in Seattle, when the company was a local roaster and coffee shop, it has expanded very quickly. In the 1990s, the chain opened a new location every weekday, which continued into the early 2000s. In the mid-1990s, the first store opened in Canada and now branches outside North America account for up to a third of the total.
These facts have attracted the attention of private investors and multinational investment corporations to buy shares of Starbucks Corporation (NASDAQ-SBUX), which generated total sales of $35.98 billion for fiscal year 2023 with an operating profit of $5.871 billion. After deducting all expenses, the company earned a net profit of $4.125 billion. The total assets of the company are USD 29.45 billion. The company employs its 381,000 tribal workers. Starbucks Corporation also pays regular quarterly dividends to its shareholders. Currently, the dividend yield is 2.49% per annum and the actual dividend amount has been approved by the company’s board of directors at $0.57 per share. According to analysts at brokerage firms and financial strategists at investment banks, the share price of (NASDAQ- SBUX) can be expected to rise in the short to medium term investment horizon, where the average target price of the stock has been set at $107.83 per share.
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