Starbucks updated as Hold – March 3, 2021

Our report on Starbucks is updated with a rating of Hold at $106.87. This is clearly a fantastic company. But it is expensive even in relation to near-term projected earnings. In the next few quarters it will show a huge earnings rebound as things open up. earnings may not exceed the comparable 2019 level until late 2021.

I have only a small position and sold half. I’d be interested in buying back into this high quality company if it happens to dip back to about $90. But of course it may not do so.

Starbucks was only added to our list in August 2018 and it traded then at $52.75. So it has more than doubled. Perhaps it is fair to ask why this company is at basically an all-time high when we still have some time before it will regain its pre-pandemic earnings level. But then again, the same can be said for the S&P 500.

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