We’ve covered Starbucks before, the world’s most famous coffee shop chain despite strong focus on the US and China and a lesser footprint outside of those countries. Succession planning has been the Achilles' Heel of this story, with Howard Schultz having returned to the top job for the third time when we covered the stock back in March 2022. The stock was trading at $88 and we were pretty bearish. Now at nearly $97, that’s roughly a 10% return in 18 months. While it may be a timing issue, that’s actually beaten the S&P 500 index over that time period. What happened that beat our expectations? Welcome to Magic Markets Premium.
With 31 Premium shows behind us, we’ve learnt so much from our detailed research on global stocks. For example, we now know that Lululemon has an incredibly strong brand and direct-to-consumer strategy, with the next results due on 2nd June. We’ve also covered brands like Nike and Starbucks, which have had a tough time recently. In the search for defensive stocks, we’ve previously highlighted Pepsico and Visa as solid companies. Both have comfortably beaten the market this year, down between 3% and 4% in 2022. Simon Property Group is the kind of business that many would choose as a defensive stock, [...]
Use the podcast player below to listen to our discussion on Starbucks and its Q1’22 result, which accompanies the detailed write-up below: (Date of report: 23 March 2022) Americans are really good at building global brands. There are coffee shops everywhere in the world, yet Starbucks is the only truly global coffee brand that is recognisable in all major countries. Thanks to deals with the likes of Nestle and PepsiCo, you'll also find the brand at your local grocery store. But it's not just the coffee that is brewing at Starbucks. There's a labour problem brewing as well, with the risk [...]
Burgers and fairy tales. These are the things that people like to invest in. No, really. In this episode of Magic Markets, we take a step back and discuss two investment themes that we find interesting. The first is the quick-service restaurant (QSR) industry, which commands premium valuations in markets across the world. There are global giants and regional powerhouses, with examples on the JSE as well as in international markets. We discuss the different types of models followed, along with concepts like franchise vs. corporate-owned models and the benefits of each strategy. We then move on to the art of [...]