Value Line report and Yahoo Finance Assignment

November 24, 2022

Value Line report and Yahoo Finance Assignment

Order Number	636738393092
Type of Project	ESSAY
Writer Level	PHD VERIFIED
Format	APA
Academic Sources	10
Page Count	3-12 PAGES

Instructions/Descriptions

Value Line report and Yahoo Finance Assignment

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Questions for Individual Analysis of Starbucks Corp

Six years ago in the media, Mr. Howard Schultz the founder of Starbucks came under intense attack and criticism. The stock was down 75% from its high in just over a year. Economists worried about rising economic slump, unemployment, loss of consumer confidence, consumer caution, and a sinking housing market. This was certain to have an impact on people’s willingness to spend money on expensive lattes and mochas.

Wall Street was writing off Starbucks stock for the next couple of years (or maybe forever) as dead money. Mr. Schultz was furious! To make matters worse McDonalds and Dunkin Donuts began serving coffee in an effort to capture customers who traditionally may have gone to Starbucks. Mr. Schultz launched an aggressive plan to downsize the number of store locations and concentrate on the core strategy of Starbucks through consolidation. At least during the past two years, these efforts seemed to have paid off. The question remains whether Starbucks can continue delivering on their new strategy and can the stock continue its upward climb.

Mr. Schultz discovers that you (who he hired in spring of this year) are taking EMBA 224. He decides that before he goes onto CNBC the next time to face grilling and pointed questions, he would like you to give him a financial briefing that he can use on CNBC to support the expectations surrounding the stock and refute economist worries. He wants you to convince him of the future financial decisions and strategies and their stock price implications. He also wants you to give him an honest opinion whether the company is financially sound as you will try and convince him or that there is trouble ahead (which he of course will try and keep to himself). Try not to get fired by doing a poor job.

Using data in the most recent Value Line report and Yahoo Finance (or any other website), please compute the following (if computable) as part of financial statement analysis:

Current ratio

Quick Ratio

Inventory Turnover Ratio

Total Assets Turnover Ratio

Days Sales Outstanding

Gross Profit Margin on Sales Ratio

Net Profit Margin on Sales Ratio

Return On Equity Ratio

Dividend Payout Ratio

Total Debt Ratio

Market to Book Ratio

Price Earnings Ratio

Price to Sales Ratio

Provide a trend analysis on each of the following measures, and then using those measures as well as those computed above provide a short commentary on how the company has been doing and expected to do in the next year: You may want to compare to its competitor and use the comparative ratios and common size statements for this.

Sales ($)

Sales per share

Earnings per share

Price Earnings Ratio

Gross margins

Net Income

Net Profits Margins

Number of Stores

ROE

Given the current P/E and Price to Sales, and projected growth in earnings over the next five years, what do you expect to stock to grow to by end of 2015 (approximately a year out)? Is the stock fairly valued, undervalued, or overvalued, given PE to Growth measures? What is your benchmark for comparison?

What is the current market value of the company? Where do you see the

Company in the life cycle?

What is the cost of capital WACC? What is the beta? What is the “normal” required rate of return using CAPM (use 3% for risk free rate, and 11% for

market return)?

What has been the total percentage return performance since its IPO in 1992 (and compare to S&P500)? Have investors received more or less than the required rate of return?

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What are the new products or strategies that will allow Starbucks to expand?

Sales and increase earnings and ultimately the stock price? What are the risks that could sink the stock?

Value Line report and Yahoo Finance Assignment

RUBRIC

Excellent Quality

95-100%

Introduction

45-41 points

The context and relevance of the issue, as well as a clear description of the study aim, are presented. The history of searches is discussed.

Literature Support

91-84 points

The context and relevance of the issue, as well as a clear description of the study aim, are presented. The history of searches is discussed.

Methodology

58-53 points

With titles for each slide as well as bulleted sections to group relevant information as required, the content is well-organized. Excellent use of typeface, color, images, effects, and so on to improve readability and presenting content. The minimum length criterion of 10 slides/pages is reached.

Average Score

50-85%

40-38 points

More depth/information is required for the context and importance, otherwise the study detail will be unclear. There is no search history information supplied.

83-76 points

There is a review of important theoretical literature, however there is limited integration of research into problem-related ideas. The review is just partly focused and arranged. There is research that both supports and opposes. A summary of the material given is provided. The conclusion may or may not include a biblical integration.

52-49 points

The content is somewhat ordered, but there is no discernible organization. The use of typeface, color, graphics, effects, and so on may sometimes distract from the presenting substance. It is possible that the length criteria will not be reached.

Poor Quality

0-45%

37-1 points

The context and/or importance are lacking. There is no search history information supplied.

75-1 points

There has been an examination of relevant theoretical literature, but still no research concerning problem-related concepts has been synthesized. The review is just somewhat focused and organized. The provided overview of content does not include any supporting or opposing research. The conclusion has no scriptural references.

48-1 points

There is no logical or apparent organizational structure. There is no discernible logical sequence. The use of typeface, color, graphics, effects, and so on often detracts from the presenting substance. It is possible that the length criteria will not be reached.