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Is SBUX Watch-List Worthy?

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January 20, 2011 – Comments (0) | RELATED TICKERS: SBUX

Starbucks has been catching my eye as of late. And most of that has to do with the international opportunities that still exist for the company. It isn't a given by any means, but there is still market share to be won out there, particularly in China and India.

It's an iconic brand and one that we all know. Think about it, as silly as the logo change is, all they really did was take the words out of it, thereby making it a universally recognized brand understood in every and any language.

I also like this move:

http://www.bizjournals.com/philadelphia/news/2011/01/19/now-you-can-pay-for-starbucks-with.html?ana=yfcpc

That's the kind of stuff that fits right in with this kind of operation.

I know there is some concern with the fact that Starbucks could be seen as a luxury good in many emerging markets still. While probably true to an extent, it's also worth remembering that as these economies continue to emerge, Starbucks' brand, et al become more and more of a reality. When I lived in Egypt for example (this was from 2003-2006), a Starbucks coffee mug or travel cup carried some sway at the time, sort of like a status symbol. Powerful brands carry a lot of weight, especially in these emerging economies. This leads me to believe that Starbucks could do pretty well with their international expansion plans.

At ~$25 billion market cap, I would say that they still have a lot of room to grow. And if we caught it on an overreaction, well that would be even sweeter.

Foolishly,

Jason

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