SBUX: Quarterly results no so pretty etc.

Bad_Badness

Bad_Badness

So after reporting there is a parade of stories describing their woes. Lots of fodder.
After earnings up about 4%. Those are the top line facts.

How it is being traded:
Took two positions, one in April and one in early July. Premise was long term hold and the 3.x% dividend. Entry in April was on a break in downward channel, 3rd pulse down, yearly support holds after 3 days of higher volume. Entry in July was double bottom holding, then a retest a day later. Looking for top of range challenge about 83. Then back to "normal" range (90-110). Not so concerned with the downward channel's upper bound around 90s. I think that is done and should only be a small amount of resistance.

Why am I posting this? Just an FYI on how one person trades. Will I make phenomenal gains? No. Is it exciting? No. Am I taking a huge position? No. Does it have a place in my longer term portfolio, yes.

YMMV.

PS: Could it have crumbled in April? Yes, but would have bought more. Can it crumble here? Yes but will buy more, last tranche. Can it go south, sure. But money management mitigates. Nevertheless, got a good entry, good allocation for now. I can always screw it up later, if I wanted to self sabotage :D

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You mean... people have finally figured out that they can make a latte at home fo $.30 instead of "driving to SBUX, waiting in line, paying $6*, then driving to work"?

Wow... what a revelation!!

* The REAL cost of a cup is time to travel to SBUX, cost of gasoline consumed in the journey, (time value) of waiting in line, paying $6 for a cup, the time it takes to go the office, cost of gas for that journey. All of that vs. paying ~ $.30 for making it at home. BTW.. the $.30 cost includes the price of a filter plus amortization/cup of a coffee maker. (First time I calculated this, the cost of a "travel cup" was closer to $.10.)

And "they" want to tell us inflation is "only 2-3%". HOGWASH!!
 
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I use to walk 3 miles for exercise then back after being there for 6 hours, quiet and traded most times or coded.

Am not much of an office person. I only get regular coffee with steamed cream. Free refillls.. LOL

Am not home much, do traveling states. Trying to find hobby farm wife likes, might take 5 years....lol
 
They have been over charging for coffee for decades, now people come to realize this??
People who do pay $5 $6 and $7 for a cup of coffee with a shot of boost in it or whatever those concoctions are about usually tell themselves oh its just 4.57 a day. Well....

257 trips to Starbucks in 1 year
$4.57 x 257 $1174 bucks on coffee a year.....

Maybe the consumer is finally feeling the pinch of paying too much ..
 
S2007S said:
They have been over charging for coffee for decades, now people come to realize this??
People who do pay $5 $6 and $7 for a cup of coffee with a shot of boost in it or whatever those concoctions are about usually tell themselves oh its just 4.57 a day. Well....

257 trips to Starbucks in 1 year
$4.57 x 257 $1174 bucks on coffee a year.....

Maybe the consumer is finally feeling the pinch of paying too much ..
More...

Well... if you're a company that understands it can sell something for $6 that cost $.06 to deliver, of course you want to be in that business. Same for an investor... who wouldn't want to own a piece of a business model like that?

That's all great until the consumer wakes up and realizes what he's paying for vs what he's getting.
 
Scataphagos said:
Well... if you're a company that understands it can sell something for $6 that cost $.06 to deliver, of course you want to be in that business. Same for an investor... who wouldn't want to own a piece of a business model like that?

That's all great until the consumer wakes up and realizes what he's paying for vs what he's getting.
More...



Starbucks has been a titan and leader in the industry for decades. Most of their growth is behind them. Meaning the stock price won't return the next 20 to 30 years as it did the previous 20 to 30 yrs, don't get me wrong, they will still continue grow but at a much slower pace than before.
 
I agree with all of the above, but just trading here.

I have never been to one in the US except to see my nephew who worked at the roaster (did not spend any $), and once in Japan where it is very different, and I ordered pasta lunch. It was very good and under $7 for lunch salad soup and tea.
A friend of mine went to one in Istanbul. Said it was like a night club (lights, thumping music) with people pulling up on high end boats ( on the Bosporus), dressed to the nines to go to the "Starbucks". Just reminds me that the US is only one country, and the rest of the world seems to view them differently.

I guess the point is, trading is trading, personal experience or preferences are moot. Also large companies with established foot prints have a lot of opportunities.

Lastly the slow growth is what I wanted for this investment. Got plenty of fast movers like HOOD and TEM. SBUX is the counter balance.
 
S2007S said:
Starbucks has been a titan and leader in the industry for decades. Most of their growth is behind them. Meaning the stock price won't return the next 20 to 30 years as it did the previous 20 to 30 yrs, don't get me wrong, they will still continue grow but at a much slower pace than before.
More...

I suspect with coming inflation and recession, volume biz at SBUX will drop off enough to significantly hurt earnings... investors might be mindful of that.
 
I believe 50% of their stores will be closed.

So many brick and mortal are closing, so many working from home, before long a family will own one car.

Our economy really changing.
 
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