First, present a comparable companies analysis for Starbucks stock (SBUX). To start, decide which comparable companies you will include in the analysis (aim to include at least 2-3 comparable companies). Then, for SBUX and each of the comparable companies you've identified, gather financial information and calculate the key ratios you will use in the analysis. Finally, perform a comparable companies analysis to land on a range of valuations for SBUX stock.

Once you have determined an estimated value from the comparable companies analysis, compare that value to the current trading price for SBUX stock. Based on your research, is the stock overvalued, undervalued, or fairly priced in the market? Present your methodology, analyses, and conclusion.

 

Guidelines:

First, decide which peer companies are relevant to include in your analysis. You may reference the group of companies selected in your prior challenge ("Industry Analysis")?

Next, gather relevant financial information from each company's most recent 10-K, and begin calculating some of the key ratios you'll use in your analysis?

Think about basing this analysis on ratios such as enterprise value/sales, price/earnings, price/book, and/or price/sales?

Conduct the comparable companies analysis to align on an estimated value for SBUX stock?

Compile your methodology, analyses, and conclusions. Be sure you are ultimately answering the question: Is SBUX currently overvalued, undervalued, or fairly priced in the market? Should an investor buy, sell, or hold SBUX stock?

Answer rating: 100% (QA)

To conduct a comparable companies analysis for Starbucks SBUX we will include the following peer com... View the full answer