Stock Markets Exposed

Would you invest in capital stock of Starbucks?

Would you invest in the capital stock of this corporation if you had sufficient funds? To answer this question, assume you made an investment in this company in January 2005. Would your investment have increased or decreased in value? Give specific data, including your ratio analysis.

Public Comments

1. Well, in Jan. 2005 the stock price fluctuated around $28 per share. It was 29.835 on 1/7, then went down during the month to 26.85 on 1/28. Considering it's 28.95 today, whether you made or lost money would depend on when in january you bought the stock. Whether you should invest would depend on how good the growth opportunities are for the company. They've done a great job opening stores, but with one on every other corner, there's not many opportunities to grow in the US left. They are turning to overseas for growth, so whether you invest would depend on whether you think they'd be successful at this and their other ventures.
2. Well one key factor that nyboi (above) neglected was the 2 for 1 split in November of 2005. Taking this into consideration, if you 100 bought at 23 in Jan 2005, and sold today at 29, you would have made 200*29-100*23 or 3500 dollars or a return of 3500/2300=1.52. over about 18 months for an annualized yield of approximately 35%. Not bad. However, at this time I don't like Starbucks. The quarter wasn't that good. How can you maintain the hospitality quotient at Starbucks when you have to hire 90,000 people just to keep up with what Wall Street wants? Don'tBuy.