NASDAQ · Consumer Cyclical

Starbucks Corporation

SBUX · Restaurants

$100.65

▲ 0.83 (0.83%)

Cached · 10 min

Overall Grade

Defensive

Enterprising

Profitability

D⤢

Gross Profit Margin 20.1%

Operating Margin 8.4%

Net Income Margin 5.4%

Fin. Health

F⤢

Years to Pay Off Debt 47.7 yrs

Working Capital vs Long-Term Debt -$14.0B

Working Capital -$890M

Valuation

D⤢

Price-to-Book N/A (neg. equity)

Cash Flow

C⤢

Free Cash Flow $92M

CapEx % of Net Income 53.4%

Owner Earnings $1.2B

Profitability

Gross Profit Margin 20.1%

Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.

Operating Margin 8.4%

Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.

Net Income Margin 5.4%

Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.

Financial Health

Years to Pay Off Debt 47.7 yrs

Total Debt ÷ Net Income. Lower = stronger balance sheet. Important caveat: utilities, telecoms, REITs, and infrastructure companies carry large structural debt by design — their bond-like cash flows service it comfortably at ratios that would alarm Graham. Compare within sector.

Working Capital vs Long-Term Debt -$14.0B

Working Capital minus Long-Term Debt. Negative results are common and expected in capital-return-focused businesses like Apple, Domino's, and McDonald's — where aggressive buybacks and dividends intentionally reduce book equity. This does not indicate financial distress in high-FCF businesses.

Working Capital -$890M

Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.

Cash Flow

Free Cash Flow $92M

Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.

CapEx % of Net Income 53.4%

Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.

Owner Earnings $1.2B

Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.

Defensive — Graham's strict criteria (P/B, P/E, dividends, stability) · Enterprising — Profitability & cash flow focused, accepts higher valuations for quality

About Starbucks Corporation

Starbucks Corporation, together with its subsidiaries, operates as a roaster, marketer, and retailer of coffee internationally. The company operates through three segments: North America, International, and Channel Development. Its stores offer coffee, tea, and other beverages, roasted whole beans and ground coffees, complementary food, packaged coffees, single-serve products, and ready-to-drink beverages; and various food products, such as pastries, breakfast sandwiches, and lunch items. The company also licenses its trademarks through licensed stores, and grocery and foodservice accounts. The company offers its products under the Starbucks Coffee, Teavana, Seattle's Best Coffee, Ethos, and Starbucks Reserve brands. Starbucks Corporation was founded in 1971 and is based in Seattle, Washington.

Market Data

Market Cap $114.7B

Enterprise Value $138.6B

P/E (TTM) 76.83

Dividend Yield 2.47%

Exchange NASDAQ

Key Margins

Gross Profit 20.1%

Operating Margin 8.4%

Net Margin 5.4%

Company Info

Sector Consumer Cyclical

Industry Restaurants

Employees 381000

Country United States

Visit website

📖

Full Graham Analysis

Mr. Market is currently offering Starbucks Corporation at $100.65.

The business passes only 3 of 7 of Graham's defensive criteria — well below his required standard.

Negative NCAV — liabilities exceed current assets. Common in capital-return businesses (buybacks, debt-funded dividends) and capital-intensive industries. Not automatically a warning sign..

Conclusion: By Graham's standards, this stock is speculative at its current price. The intelligent investor would look elsewhere or wait.

Showing Key Metrics

Income Highlights

Metric	Q1 2026	Q4 2025	Q3 2024
Gross Profit %	20.1%▼	21.1%•	N/A
Operating Margin %	8.4%▼	9.3%•	N/A
Net Income %	5.4%▲	3.0%•	N/A
Diluted EPS	0.45▲	0.26•	N/A

Balance Sheet Highlights

Metric	Q1 2026	Q4 2025	Q3 2024
Total Assets	$30.6B	$32.2B	N/A
Total Debt	$24.4B▼	$25.5B•	N/A
Working Capital	-$890M▼	$536M•	N/A
Years to Pay Debt	47.74	86.84	N/A

Cash Flow Highlights

Metric	Q1 2026	Q4 2025	Q4 2024
Free Cash Flow	$92M▼	$1.3B•	N/A
Owner Earnings	$1.2B	$1.0B	N/A
CapEx % of Net Income	53.4%	110.4%	N/A

Income Statement

	2026	2025
Tax Effect Of Unusual Items	-7,491	-18,501
Tax Rate For Calcs	0	0
Normalized EBITDA	1,279,400	1,423,800
Total Unusual Items	-25,100	-88,100
Total Unusual Items Excluding Goodwill	-25,100	-88,100
Net Income From Continuing Operation Net Minority Interest	510,900	293,300
Reconciled Depreciation	389,200	431,900
Reconciled Cost Of Revenue	7,591,300	7,794,900
EBITDA	1,254,300	1,335,700
EBIT	865,100	903,800
Net Interest Income	-100,000	-126,000
Interest Expense	137,000	139,000
Interest Income	37,000	13,000
Normalized Income	528,509	362,899
Net Income From Continuing And Discontinued Operation	510,900	293,300
Total Expenses	8,729,100	8,996,800
Rent Expense Supplemental	768,100	804,800
Total Operating Income As Reported	828,100	890,800
Diluted Average Shares	1,143,200	1,141,900
Basic Average Shares	1,139,500	1,139,100
Diluted EPS	0	0
Basic EPS	0	0
Diluted NI Availto Com Stockholders	510,900	293,300
Net Income Common Stockholders	510,900	293,300
Net Income	510,900	293,300
Minority Interests	100	100
Net Income Including Noncontrolling Interests	510,800	293,200
Net Income Continuous Operations	510,800	293,200
Tax Provision	217,300	471,600
Pretax Income	728,100	764,800
Other Income Expense	25,700	-27,500
Special Income Charges	-25,100	-88,100
Restructuring And Mergern Acquisition	25,100	88,100
Earnings From Equity Interest	50,800	60,600
Net Non Operating Interest Income Expense	-100,000	-126,000
Interest Expense Non Operating	137,000	139,000
Interest Income Non Operating	37,000	13,000
Operating Income	802,400	918,300
Operating Expense	1,112,000	1,170,900
Other Operating Expenses	130,500	131,200
Depreciation Amortization Depletion Income Statement	363,400	400,900
Depreciation And Amortization In Income Statement	363,400	400,900
Selling General And Administration	618,100	638,800
General And Administrative Expense	618,100	638,800
Other Gand A	618,100	638,800
Gross Profit	1,914,400	2,089,200
Cost Of Revenue	7,617,100	7,825,900
Total Revenue	9,531,500	9,915,100
Operating Revenue	8,904,800	9,318,400

Balance Sheet

	2026	2025	2024
Ordinary Shares Number	1,139,500	1,139,100
Share Issued	1,139,500	1,139,100
Net Debt	13,549,900	12,667,000
Total Debt	24,391,400	25,470,900
Tangible Book Value	-9,936,200	-9,867,000
Invested Capital	6,616,800	7,691,700
Working Capital	-890,200	536,000
Net Tangible Assets	-9,936,200	-9,867,000
Capital Lease Obligations	9,309,500	9,390,500
Common Stock Equity	-8,465,100	-8,388,700
Total Capitalization	4,619,100	6,192,200
Total Equity Gross Minority Interest	-8,457,700	-8,381,300
Minority Interest	7,400	7,400
Stockholders Equity	-8,465,100	-8,388,700
Gains Losses Not Affecting Retained Earnings	-417,300	-425,900
Other Equity Adjustments	-417,300	-425,900
Retained Earnings	-8,881,000	-8,685,400
Additional Paid In Capital	832,100	721,500
Capital Stock	1,100	1,100
Common Stock	1,100	1,100
Total Liabilities Net Minority Interest	39,015,200	40,609,600
Total Non Current Liabilities Net Minority Interest	27,565,800	29,123,000
Other Non Current Liabilities	794,600	746,500
Non Current Deferred Liabilities	5,678,700	5,748,000
Non Current Deferred Revenue	5,678,700	5,748,000
Long Term Debt And Capital Lease Obligation	21,092,500	22,628,500
Long Term Capital Lease Obligation	8,008,300	8,047,600
Long Term Debt	13,084,200	14,580,900
Current Liabilities	11,449,400	11,486,600
Other Current Liabilities	1,685,600	1,754,600
Current Deferred Liabilities	1,828,700	2,121,700
Current Deferred Revenue	1,828,700	2,121,700
Current Debt And Capital Lease Obligation	3,298,900	2,842,400
Current Capital Lease Obligation	1,301,200	1,342,900
Current Debt	1,997,700	1,499,500
Other Current Borrowings	1,997,700	1,499,500
Current Provisions	357,400	335,500
Payables And Accrued Expenses	4,278,800	4,432,400
Current Accrued Expenses	1,612,100	1,672,600
Payables	2,666,700	2,759,800
Dividends Payable	706,400	706,200
Total Tax Payable	286,000	371,400
Income Tax Payable	70,300	127,500
Accounts Payable	1,674,300	1,682,200
Total Assets	30,557,500	32,228,300
Total Non Current Assets	19,998,300	20,205,700
Other Non Current Assets	817,800	778,600
Non Current Deferred Assets	1,541,800	1,600,800
Non Current Deferred Taxes Assets	1,541,800	1,600,800
Investments And Advances	789,400	720,300
Investmentin Financial Assets	306,300	288,300
Available For Sale Securities	306,300	288,300
Long Term Equity Investment	483,100	432,000
Investmentsin Joint Venturesat Cost			424,100
Investments In Other Ventures Under Equity Method			39,800
Goodwill And Other Intangible Assets	1,471,100	1,478,300
Other Intangible Assets	176,000	167,200
Goodwill	1,295,100	1,311,100
Net PPE	15,378,200	15,627,700
Accumulated Depreciation	-10,384,100	-10,180,800
Gross PPE	25,762,300	25,808,500
Leases	10,379,900	10,399,200
Construction In Progress	309,100	309,100
Other Properties	12,588,100	12,610,400
Machinery Furniture Equipment	1,764,600	1,764,400
Buildings And Improvements	665,700	670,400
Land And Improvements	54,900	55,000
Current Assets	10,559,200	12,022,600
Other Current Assets	368,800	374,100
Assets Held For Sale Current	5,043,400	4,716,600
Inventory	2,157,800	2,114,400
Finished Goods	732,800	685,900
Raw Materials	1,425,000	1,428,500
Receivables	1,288,900	1,219,200
Accounts Receivable	1,288,900	1,219,200
Allowance For Doubtful Accounts Receivable			-21,200
Gross Accounts Receivable			1,235,000
Cash Cash Equivalents And Short Term Investments	1,700,300	3,598,300
Other Short Term Investments	168,300	184,900
Cash And Cash Equivalents	1,532,000	3,413,400

Cash Flow

	2026	2025	2024
Free Cash Flow	91,800	1,274,000
Repayment Of Debt	-1,000,000	0
Issuance Of Debt	0	2,500
Issuance Of Capital Stock	18,800	17,700
Capital Expenditure	-272,700	-323,700
Interest Paid Supplemental Data	172,000	142,400
Income Tax Paid Supplemental Data	225,600	94,900
End Cash Position	1,532,000	3,413,400
Other Cash Adjustment Outside Changein Cash	-222,800	-347,200	0
Beginning Cash Position	3,413,400	3,219,800
Effect Of Exchange Rate Changes	-3,100	9,000
Changes In Cash	-1,655,500	531,800
Financing Cash Flow	-1,689,600	-743,000
Cash Flow From Continuing Financing Activities	-1,689,600	-743,000
Net Other Financing Charges	-2,100	-58,100
Cash Dividends Paid	-706,300	-705,100
Common Stock Dividend Paid	-706,300	-705,100
Net Common Stock Issuance	18,800	17,700
Common Stock Issuance	18,800	17,700
Net Issuance Payments Of Debt	-1,000,000	2,500
Net Short Term Debt Issuance	0	2,500
Short Term Debt Payments	0	0
Short Term Debt Issuance	0	2,500
Net Long Term Debt Issuance			0
Long Term Debt Payments			0
Long Term Debt Issuance
Investing Cash Flow	-330,400	-322,900
Cash Flow From Continuing Investing Activities	-330,400	-322,900
Net Other Investing Changes	-48,000	-25,700
Net Investment Purchase And Sale	-9,700	26,500
Sale Of Investment	44,900	77,500
Purchase Of Investment	-54,600	-51,000
Net PPE Purchase And Sale	-272,700	-323,700
Purchase Of PPE	-272,700	-323,700
Operating Cash Flow	364,500	1,597,700
Cash Flow From Continuing Operating Activities	364,500	1,597,700
Dividend Received Cfo	13,000	96,700
Change In Working Capital	-979,800	-58,400
Change In Other Working Capital	-328,200	390,400
Change In Other Current Liabilities	-446,100	-433,200
Change In Payables And Accrued Expense	-63,700	16,400
Change In Payable	-63,700	16,400
Change In Account Payable	-2,400	-39,000
Change In Tax Payable	-61,300	55,400
Change In Income Tax Payable	-61,300	55,400
Change In Inventory	-58,600	-31,800
Change In Receivables	-83,200	-200
Changes In Account Receivables	-83,200	-200
Other Non Cash Items	315,100	358,200
Stock Based Compensation	93,200	126,100
Deferred Tax	60,400	302,600
Deferred Income Tax	60,400	302,600
Depreciation Amortization Depletion	389,200	431,900
Depreciation And Amortization	389,200	431,900
Operating Gains Losses	-37,400	47,400
Earnings Losses From Equity Investments	-65,700	-62,300
Net Income From Continuing Operations	510,800	293,200

📊 Quarterly mode — Graham Fair Value & 7 Criteria require annual data. Switch to Annual for full analysis.

Quarter vs Same Quarter Last Year

YoY strips seasonality

Revenue Growth (YoY)

Prior year: $8.8B ▲ $9.5B +8.8%

Revenue growth vs same quarter last year strips seasonality. Consistent double-digit growth is a Buffett hallmark.

Gross Margin

Prior year: 21.1% ▲ 20.1% -1.0pp

Buffett: consistent gross margin above 40% signals durable pricing power and competitive moat.

Operating Margin

Prior year: 9.2% ▲ 8.4% -0.7pp

Graham: operating margin reflects true business economics before financing. Trend matters as much as level.

Net Margin

Prior year: 4.4% ▲ 5.4% +1.0pp

Net margin can be distorted by one-time items, tax timing, or interest costs — compare to operating margin for signal quality.

Quarterly Health Checks

3 Graham/Buffett criteria that are valid and reliable on quarterly data

✅ Adequate Size

Graham required scale for resilience. Quarterly revenue × 4 gives an annualised proxy.

$9.5B/qtr (≈$38.1B ann.)

vs > $1.5B annualised revenue

❌ Financial Condition

Current assets vs current liabilities — a real-time liquidity snapshot. Valid and reliable on quarterly data.

0.92x current ratio

vs ≥ 2.0x

✅ Free Cash Flow

Buffett's most important single metric. A positive FCF quarter means the business generated real cash for owners after maintaining its asset base.

$92M

vs Positive

Operating Cash Flow

$364M

Latest quarter · Buffett's cash reality check

ROIC

3.3%

Based on latest annual operating income

Return on Invested Capital — Buffett's preferred measure for asset-light businesses. ROIC > 15% consistently signals a durable competitive advantage (moat). More meaningful than P/B for software, pharma, and consumer brand companies where most value is intangible and off-balance-sheet.

Market Cap / Net Assets

⚠ Negative Net Assets

Net Assets: -$8.5B

⚠ Negative Net Assets — total liabilities exceed total assets on paper. This is common in companies that aggressively return capital via buybacks and dividends (Apple, McDonald's, Domino's). It does not indicate insolvency if the business generates strong, consistent free cash flow. Focus on FCF and earnings power rather than balance sheet book value for these companies.

Peers & Industry Comparison

Restaurants — Auto-detected peers

Company	Price	Market Cap	P/E	Gross Margin	Net Margin	Revenue
SBUX	$100.65	$114.7B	76.83	20.1%	5.4%	$9.5B
MCD McDonald's Corporation	$278.61	$198.0B	23.0	57.3%	31.6%	$27.4B
YUM Yum! Brands, Inc.	$151.99	$41.9B	24.5	45.7%	20.5%	$8.5B
QSR Restaurant Brands International	$73.44	$33.5B	23.6	33.9%	10.0%	$9.6B
DPZ Domino's Pizza Inc	$312.47	$10.4B	18.0	28.7%	11.9%	$5.0B

"The management of a business is its most important single factor — more important than market position, patents, or financial structure."

— Benjamin Graham

Capital Allocation & Alignment

Insider Ownership

0.13%

Low — management has little skin in the game

Return on Assets (ROA)

1.7%

Poor — assets are not generating adequate returns

Debt Trend YoY

-4.2% YoY

Debt is declining — management is deleveraging

Leadership Team

Brian Niccol

Chairman & CEO

Age 51

Pay: $11,111,188

2.175% of net income

Mike Grams

EVP & COO

Age 54

Pay: $1,380,012

0.270% of net income

Andy Adams

Senior Vice President of Global Growth & Concepts

Janet Landers

Senior Vice President of Business Technology

Mark Ring

Senior Vice President of U.S Licensed Stores, Starbucks Canada & Siren Retail

Top Institutional Holders

Institution	% Owned	Shares
Capital World Investors	73.96%	103,315,629
Capital Research Global Investors	73.26%	102,348,519
Blackrock Inc.	56.95%	79,564,331
Vanguard Capital Management LLC	52.99%	74,026,228
State Street Corporation	34.17%	47,729,771
Vanguard Portfolio Management LLC	21.08%	29,445,025
Geode Capital Management, LLC	20.05%	28,016,179
FMR, LLC	18.44%	25,764,525

⚠️ Current ratio below 1 — liquidity risk

Risk Analysis

Beta (Market Risk)

0.98

Low volatility — more stable than the market

Short Interest

4.7% of float

Low short interest — market is not heavily bearish

Current Ratio

0.92x

Weak liquidity — current liabilities exceed current assets

52-Week Price Range

Low: $77.99 Current: $100.65 High: $108.88

Currently at 73% of 52-week range

Starbucks Corporation

Metric Explanations

Full Graham Analysis

Income Highlights

Balance Sheet Highlights

Cash Flow Highlights

Quarter vs Same Quarter Last Year

Quarterly Health Checks

Operating Cash Flow

ROIC

Market Cap / Net Assets

Peers & Industry Comparison

Capital Allocation & Alignment

Leadership Team

Top Institutional Holders

Risk Analysis