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Investment Strategies / Falling Knives
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Author: Rebus   😊 😞
Number: of 674 
Subject: SBUX
Date: 07/07/2023 12:02 PM
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No. of Recommendations: 1
A cup of Joe and a few shares of stock, anyone?
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Author: rnam ✧  😊 😞
Number: of 674 
Subject: Re: SBUX
Date: 07/07/2023 12:32 PM
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No. of Recommendations: 3
I will pass on both the coffee and the stock.

Their coffee (Charbucks) is too burnt and bitter for my test.

Stock up 22% last year and trading at 28 forward PE. Hardly a falling knife or a bargain.
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Author: PhoolishPhilip ✶  😊 😞
Number: of 674 
Subject: Re: SBUX
Date: 07/08/2023 9:07 AM
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No. of Recommendations: 0
Agree on the value, but their blond roast is pretty good. Nowhere near as bitter as pikes.
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Author: rnam ✧  😊 😞
Number: of 674 
Subject: Re: SBUX
Date: 07/08/2023 9:47 AM
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No. of Recommendations: 8
I think Dollar General is a better buy than SBUX, esp. if there is a recession. Its customers' purchases are less discretionary than SBUX's. Plus they may get customers downgrading from more expensive stores. And in rural areas they may not have other options. Their main dollar store competitor, Dollar Tree, has been struggling with integrating Family Dollar stores that it acquired.

DG is trading at fwd PE of 16 compared to 5 year average of 20.5. ROE is almost 40%. They are still opening stores and should be able to continue for several more years. Share price has been cut by a third over the last year due to earnings shortfall blamed on supply chain and inflation issues, but this should ease in a couple of quarters.
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