Is NASDAQ:SBUX a Good Fit for Dividend Investing?

Last update: Apr 26, 2024

Consider STARBUCKS CORP (NASDAQ:SBUX) as a top pick for dividend investors, identified by our stock screening tool. NASDAQ:SBUX shines in terms of profitability, solvency, and liquidity, all while paying a decent dividend. Let's dive deeper into the analysis.

Understanding NASDAQ:SBUX's Dividend Score

ChartMill provides a Dividend Rating for every stock, ranging from 0 to 10. This rating assesses various dividend aspects, including yield, growth, and sustainability. NASDAQ:SBUX earns a 7 out of 10:

SBUX's Dividend Yield is rather good when compared to the industry average which is at 2.62. SBUX pays more dividend than 84.33% of the companies in the same industry.
On average, the dividend of SBUX grows each year by 10.79%, which is quite nice.
SBUX has paid a dividend for at least 10 years, which is a reliable track record.
SBUX has not decreased their dividend for at least 10 years, which is a reliable track record.
The dividend of SBUX is growing, but earnings are growing more, so the dividend growth is sustainable.

A Closer Look at Health for NASDAQ:SBUX

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:SBUX has earned a 4 out of 10:

With an excellent Altman-Z score value of 2.98, SBUX belongs to the best of the industry, outperforming 80.60% of the companies in the same industry.
The Debt to FCF ratio of SBUX is 3.42, which is a good value as it means it would take SBUX, 3.42 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 3.42, SBUX is doing good in the industry, outperforming 79.85% of the companies in the same industry.

Evaluating Profitability: NASDAQ:SBUX

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:SBUX has earned a 6 out of 10:

SBUX's Return On Assets of 14.71% is amongst the best of the industry. SBUX outperforms 91.04% of its industry peers.
The Return On Invested Capital of SBUX (22.00%) is better than 92.54% of its industry peers.
SBUX had an Average Return On Invested Capital over the past 3 years of 18.26%. This is significantly above the industry average of 10.33%.
The 3 year average ROIC (18.26%) for SBUX is below the current ROIC(22.00%), indicating increased profibility in the last year.
With a decent Profit Margin value of 11.70%, SBUX is doing good in the industry, outperforming 77.61% of the companies in the same industry.
The Operating Margin of SBUX (15.69%) is better than 67.16% of its industry peers.

More Best Dividend stocks can be found in our Best Dividend screener.

Check the latest full fundamental report of SBUX for a complete fundamental analysis.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.