Are you considering investing part of your capital on the American Stock Exchange and trading in the Starbucks group stock? In this case, take a few moments to read the following information which will help you to carry out your analyzes of this value. You'll find the price chart of this stock as well as its historical analysis in this file.
Starbucks' expansion strategy in emerging markets should be followed carefully.
As well as measures taken to diversify the group's activities which are important for a good analysis of this stock.
All the strategic alliances and partnerships set up by the Starbucks group should of course be monitored for their impact on strengthening the company's presence and market share in the world. This particularly involves alliances with retailers or anything regarding everyday consumer goods.
Starbucks direct and indirect competition should also be watched. Particularly large restaurant chains which generally offer similar products and at lower cost.
The communication campaigns implemented by Starbucks in order to counter certain changes in consumer habits who currently favour local businesses are also to be taken into account, as are the current major socio-cultural trends.
A good knowledge of the Starbucks company is of course important if you want to trade or buy this stock. An experienced investor knows that the activities and segments in which a company operates, as well as the distribution of its turnover, will have a direct effect on its share price. For this reason, we are now providing a detailed overview of Starbucks and its revenue sources.
The Starbucks Corporation is an American company listed on the NYSE Main Market, which operates in the restaurant business. More specifically, the company specialises in owning and operating coffee shops. In addition to this core business, the Starbucks Group also has a coffee roasting business.
To better understand the company's activities, they can be divided into different divisions according to the share of turnover they generate, as follows:
It is also important to take into account the geographical distribution of Starbucks' turnover, which is 71.8% in the USA, 11% in China and 17.2% in the rest of the world.
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In order to perform good analysis of the Starbucks share price, you need to study closely the various statements and publications of the competition. Here are the main competitors to follow at the moment:
This Swiss multinational company is one of the main leaders in the food industry in the world and the first in this sector in terms of turnover. It is also the leader in milk production. Nestlé processes and markets a wide range of products and beverages and is one of the leading innovators in Europe. Its shares are listed on the SIX Swiss Exchange and it is one of the largest companies in the world.
This company is an American fast-food chain founded in 1952 by Ray Kroc who was a businessman who bought the rights to a small hamburger chain previously operated by Richard and Maurice Mc Donald. A few years ago, it was the largest fast food chain in terms of number of meals served.
This other American fast food franchise chain sells mainly sandwiches and salads. In the 2010s, it became the largest fast-food chain, surpassing McDonald's, in terms of number of restaurants, with over 45,000 restaurants worldwide in 110 countries.
We will also follow the American food multinational Mondelez, which is present in the biscuit and chocolate segments in particular, and which is established almost everywhere in the world. Mondelez is the world's second largest food company in terms of sales volume. Formerly a subsidiary of Altria under the name of Kraft Foods, it became independent in 2007 and took its current name in 2012 after splitting off its North American activities. The Mondelez International Group now markets its products in 165 countries and has manufacturing facilities in 58 countries.
Finally, this company, also known as JDE, is a Dutch food company specialising in coffee and tea. This company is the result of the merger in 2015 of DE Master Blenders 1573 and the coffee division of Mondelez International. Based in Amsterdam, the company's majority shareholder is the Reimann family through Acorn Holdings within JAB Holding.
Let's check out Starbucks' main partners in detail.
In 2014, Starbucks joined the Selecta group (unattended self-service retailer) offering its range of coffees to French and European companies customers of the company.
In 2015, Starbucks signed a partnership with the Spotify group. Users subscribed to Spotify Premium are able to access free drinks and choose the music played in Starbucks coffeehouses.
Starbucks also signed a partnership with the Casino Restauration subsidiary of the Casino group in 2015, which facilitated the opening of Starbucks cafes in the group's hypermarkets in France. The same year, Starbucks signed a similar partnership with another big name in the distribution industry, Monoprix, and also set up its coffeehouses.
Firstly, one of Starbucks' most important assets is undoubtedly its brand image. The brand has succeeded in making itself popular all over the world and is now one of the best known brands internationally, which is of course an advantage in making it easier for the brand to establish itself wherever it wants to.
In addition, the Starbucks Group's customer base continues to grow year after year. The customers recruited in this way are then quickly retained and the group benefits from greater stability in its business over time.
Since Starbucks is, as you will have understood, primarily based on an international expansion strategy, it can of course count on a very extensive supply chain around the world. This, of course, helps to effectively support its operations. The company's suppliers are thus carefully selected and well distributed geographically, allowing for fast and regular supply and control of transport costs.
Starbucks' strategy of diversifying its activities with the acquisition or development of subsidiaries such as Ethos Water or Best Coffee is another undeniable asset of the group. This diversification in the company's activities enables it to reduce the market and industry risks of its core business.
Firstly, Starbucks' high price policy can be cited as an important weakness. These high prices increase the company's margins but at the same time reduce the affordability of their products. As a result, the company's market shares are limited, and Starbucks actually reaches only a very small portion of the customer base in this industry.
The fact that Starbucks uses standardized and generalized protocols for the manufacture of its products may prove to be a definite handicap for its future development. Starbucks may have difficulty establishing a presence in certain countries and geographic areas because of an inability to align itself with the cultural references of those markets.
While Starbucks has made its name through original products, these are not protected by patents and can therefore be very easily imitated. The group's local competitors therefore take advantage of this to offer equivalent products at a lower cost, which represents a significant loss of market share for the American company. Some of Starbucks' competitors even go so far as to copy the atmosphere of the chain's cafés to attract more consumers. Some directly competing chains are beginning to expand around the world.
The latest financial results known for the Starbucks Company are those for the fiscal year 2019. We know that the company achieved a turnover of around $ 26,509 million that year in September. Its net income was $ 3,599 million for the same year. Bear in mind that at the end of 2019, the market capitalization of the Starbucks group was $ 103,763 million.
Since the Starbucks group is accountable to shareholders, it regularly publishes reports of its important strategic meetings and implements strategic development plans. It is possible to consult this information as well as other financial, economic and stock market information on the investors section on the company's website.
You shouldn't rely on just one type of analysis if you want to best anticipate changes in the Starbucks share price. It's by jointly using several types of analysis including technical analysis, fundamental analysis, financial analysis, sector analysis and competitive analysis that you are most likely to understand how this value is likely to evolve in the more or less long term.
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