Starbucks Financial Statements and Financial Ratios Analyzed from 2016 to 2020
Hey All,
Thanks for visiting my Starbucks Financial Report page. On this page, you will be able to find preliminary information about Starbucks ' current financial performance as well as some historical track records and trends.
For a more detailed examination of Starbucks ' financial performance, please check out the "Financial Report". In this report, written by myself, Paul Borosky, MBA., Doctoral Candidate, and published author, you will find:
- Summarized income statement for the last 5 years.
- Summarized balance sheet for the last 5 years.
- Summary analysis by myself of important income statement, balance sheet, and financial ratio trends and other happenings.
- Five year’s worth of over twenty common financial ratios presented with formulas, calculations, and analysis tips for each ratio.
- Line by line description, explanation, and analysis tip for most financial statement line items and financial ratios.
- Professional financial analysis tips provided in each section to help YOU conduct your OWN financial analysis!
- Each section includes an “in other words” segment. This is where I use plain English to explain concepts.
Enjoy the preliminary information and for a more detailed analysis, buy the financial report!
Sincerely,
Paul Borosky, MBA.
PDF/Downloadable Version
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Sample Financial Report
Starbucks Company Summary From 2016 to 2020
Starbucks headquarters is located in Seattle, Washington. The company competes in the consumer cyclical sector—specifically, the restaurant industry. At present, the organization employs approximately 340,000 individuals. Starbucks' main revenue generators are coffee sales, pastry sales, and retail sales from grocers of their coffee products. The organization has coffee shops in the United States, China, Canada, Japan, and several other countries the world over.
From a financial perspective, Starbucks' market capitalization is about $118 billion. Their beta is .81. This indicates that the company's stock is slightly less risky as compared to the overall market. Their stock price range for the last 52 weeks has been between $50.02 to $102.21. In the last year, their dividend payout has increased slightly. At present, the dividend yield is 1.76%.
Starbuck Financial Report Sources
"Starbucks 2020 Financial Statements and Financial Ratios: Defined, Discussed, and Analyzed for 5 Years” was written by, Paul Borosky, MBA., doctoral candidate, and owner of Quality Business Plan. In this summarized book, the author researched Starbucks 10k, Starbucks 2017 10k annual report, Starbucks 2016 10k annual report, Starbucks 2020 10k annual report, and Starbucks 2019 10k annual report as the basis for information gathering. Once all Starbucks 10k annual statements were collected, the author then inserted Starbucks income statement information and Starbucks balance sheet information into a customized financial template.
Section 1: Starbucks’s Income Statement – Summary Analysis
In this section, I walk through a broad definition as to what an income statement is and why it is important. From this, I then discuss and define income statement line items, such as revenues, gross profits, etc. in detail. After each line item is defined and discussed, I finally offer a summary analysis of Starbuck's important income statement line item trends from 2016 to 2020, in most cases.
Section 1: Starbucks’s Income Statement – Summary Analysis
In this section, I walk through a broad definition as to what an income statement is and why it is important. From this, I then discuss and define income statement line items, such as revenues, gross profits, etc. in detail. After each line item is defined and discussed, I finally offer a summary analysis of Starbuck's important income statement line item trends from 2016 to 2020, in most cases.
Revenue Growth:
Starbucks ended 2016 with approximately $21.3 billion in sales. In the next three years, the organization would substantially increase its revenues ending 2019 with approximately $26.5 billion in sales. Unfortunately, Starbucks' revenues would drop in 2020 to $23.5 billion. A driving reason for the decrease in revenues would be the Covid 19 pandemic.
SG&A:
Starbucks SG&A ended 2016 at $1.4 billion. In the next three years, the organization would increase its SG&A to $1.8 billion in 2019. Fortunately, the organization would lower its overhead costs to $1.6 billion in 2020. The shift from trend increases in SG&A to decreasing indicates that the organization is either better aligning their fixed costs with revenues. Or, the organization is anticipating slower revenue growth in the future, and they are taking preemptive steps to ensure optimal use of their scarce resources through fixed costs reductions.
Starbucks 2020 Summary Income Statement |
|||||
| Column1 |
2020 |
2019 | 2018 | 2017 |
2016 |
| Revenues |
23,518 |
26,508 | 24,720 | 22,387 |
21,316 |
| COGS |
7,694 |
8,527 | 10,175 | 9,034 |
8,509 |
| Gross Profit |
15,824 |
17,981 | 14,545 | 13,353 |
12,807 |
| SG&A |
1,679 |
1,824 | 1,759 | 1,451 |
1,409 |
| Depreciation |
1,431 |
1,377 | 1,247 | 1,011 |
981 |
| R & D | - |
- |
224 | 154 |
- |
| Other | - | - | - | - | - |
| Operating Expenses |
22,278 |
22,728 | 21,137 | 18,643 |
17,462 |
| EBIT |
1,561 |
4,077 | 3,883 | 4,135 |
4,172 |
| Other Income | - | - |
191 |
181 |
103 |
| Interest Expense |
437 |
331 | 170 | 93 |
81 |
| EBT |
1,164 |
4,466 | 5,780 | 4,318 |
4,199 |
| Taxes |
239 |
872 | 1,262 | 1,433 |
1,380 |
| Net Income |
928 |
3,599 | 4,518 | 2,885 |
2,818 |
Section 2: Starbucks Balance Sheet – Summary Analysis
For Starbuck's balance sheet, I again go through each important line item from the balance sheet. In reviewing each line item, I will define Starbucks ' balance sheet line item, such as cash, property, plant and equipment, and liabilities between 2015 to 2019. Next, I then offer a summary analysis of Starbucks ' important balance sheet line items.
Cash:
Starbucks' cash position ended in 2016 at $2.1 billion. In the next year, the organization would slightly increase their cash position ending 2017 at $2.4 billion. In 2018, Starbucks would substantially increase their cash position ending the year at $8.7 billion. However, in the next two years, their cash position would fall to $2.6 billion in 2019 only rebound to $4.3 billion in 2020.
Accounts Receivable:
Starbucks Accounts Receivable ended 2016 at $769 million. In the next year, the organization's Accounts Receivable position would increase to $870 million. However, in 2018, the organization's Accounts Receivable would fall to $693 million. Fortunately, the organization would increase its Accounts Receivable in the next two years ending 2020, at $883 million.
Inventory.
Starbucks inventory ended 2016 at $1.3 billion. In the next three years, the organization's inventory would increase substantially, ending 2019 at $1.5 billion. However, the organization would take steps to mitigate and lower their inventory holding ending 2020 at $1.1 billion.
Starbucks 2020 Summary Balance Sheet |
|||||
| Column1 |
2020 |
2019 | 2018 | 2017 |
2016 |
| Cash |
4,350 |
2,686 | 8,756 | 2,462 |
2,129 |
| Short Term Investment |
281 |
71 | 182 | 229 |
134 |
| Account Receivable |
883 |
879 | 693 | 870 |
769 |
| Inventory |
1,151 |
1,529 | 1,401 | 1,364 |
1,379 |
| Other | |||||
| Current Assets |
7,806 |
5,653 | 12,494 | 5,283 |
4,761 |
| Net PPE |
6,241 |
6,431 | 5,929 | 4,920 |
4,534 |
| Goodwill |
3,597 |
3,490 | 3,542 | 1,539 |
1,720 |
| Other | |||||
| Total Assets |
29,374 |
19,220 | 24,156 | 14,366 |
14,330 |
| Accounts Payable |
997 |
1,189 | 1,179 | 783 |
731 |
| Accrued Expense |
1,856 |
2,418 | 2,298 | 1,935 |
1,999 |
| Accrued Taxes |
98 |
1,292 | 103 | - |
- |
| Notes Payable |
438 |
- | - | - |
- |
| LT Debt - Current |
1,249 |
- | 350 | - |
400 |
| Other | - | - | - | - | - |
| Total Current Liabilities |
7,346 |
6,169 | 5,684 | 4,221 |
4,547 |
| LT Debt |
14,659 |
11,167 | 9,090 | 3,933 |
3,202 |
| Other | |||||
| Total Liabilities |
37,173 |
25,451 | 22,981 | 8,909 |
8,439 |
| Common Stock |
373 |
41 | 42 | 43 |
43 |
| Treasury | - | - | - | - | |
| Retained Earnings |
(7,815) |
(5,771) | 1,457 | 5,563 |
5,950 |
| Other | - | - | - | ||
| Total Equity |
(7,805) |
(6,232) | 1,176 | 5,457 |
5,891 |
| Total Equity & Liability |
29,374 |
19,220 | 24,156 | 14,366 |
14,330 |
Section 3: Starbucks Financial Ratio Summary From 2016 to 2020
For this section, I have chosen several different financial ratios to review for Starbuck's Inc from 2016 to 2020. In reviewing each of Starbucks ' financial ratios, I first start with defining the financial ratio. Next, I supply the financial formula for calculating the specific ratio. Finally, I offer a brief analysis of Starbucks ' important financial ratios.
Starbucks Current Ratio
Starbucks' current ratio ended in 2016 at 1.05. In the next two years, the organization's current ratio would increase to 2.2 ending in 2018. However, in 2019 the organization's current ratio would plummet to .92 in 2019, only to rebound again in 2020 to 1.06.
Starbucks Total Asset Turnover
Starbucks' total asset turnover ended 2016 at 1.49. In the next two years, the company's total asset turnover would fall to 1.02. Fortunately, in 2019, the company's total asset turnover would rebound to 1.38 only to fall in 2020 to .8, which is a five year low.
Starbucks Return on Assets
Starbucks' return on assets ended 2016 at 19.6%. In the next year, the organization would improve its return on assets ending 2017 at 20%. However, in the next two years, Starbucks would slightly decrease their return on asset rate in 2019, ending at 18.7%. In 2020, their return on assets would fall substantially, ending the year at 3.1%.
Starbucks Debt Ratio
Starbucks debt ratio ended 2016 at 22.3%. In the next four years, the organization would substantially increase its debt ratio ending 2019 at 58.1%. Fortunately, in 2020, the organization would be able to reduce its debt ratio ending the year at 49.9%.
Starbucks 2020 Liquidity Ratios |
|||||
| Ratios |
2020 |
2019 | 2018 | 2017 |
2016 |
| Current Ratio |
1.06 |
0.92 |
|
||
| Cash Ratio |
0.59 |
0.44 |
|||
| Quick Ratio |
0.91 |
0.67 |
|||
| Net Working Capital |
3,433 |
195 |
|||
Starbucks 2020 Asset Utilization |
|||||
| Ratios |
2020 |
2019 | 2018 | 2017 |
2016 |
| Total Asset Turnover |
0.80 |
1.38 |
|||
| Fixed Asset Turnover |
3.77 |
4.12 |
|||
| Days Sales Outstanding |
13.70 |
12.11 |
|||
| Inventory Turnover |
20.43 |
17.34 |
|||
| Accounts Receivable Turnover |
26.63 |
30.15 |
|||
| Working Capital Turnover |
6.85 |
135.80 |
|||
| AP Turnover |
23.59 |
22.29 |
|||
| Average Days Inventory |
54.60 |
65.45 |
|||
| Average Days Payable |
47.30 |
50.90 |
|||
| Cash Conversion Cycle |
21.01 |
26.66 |
|||
Starbucks 2020 Profitability Ratios |
|||||
| Ratios |
2020 |
2019 | 2018 | 2017 |
2016 |
| Return on Assets |
3.16% |
18.73% |
|||
| Return on Equity |
-11.89% |
-57.75% |
|||
| Net Profit Margin |
3.95% |
13.58% |
|||
| Gross Profit Margin |
67.28% |
67.83% |
|||
| Operating Profit Margin |
6.64% |
15.38% |
|||
| Basic Earning Power |
5.31% |
21.21% |
|||
| ROCE |
7.09% |
31.24% |
|||
| Capital Employed |
22,028 |
13,051 |
|||
| ROIC |
12.82% |
49.52% |
|||
Starbucks 2020 Long-term Debt |
|||||
| Ratios |
2020 |
2019 | 2018 | 2017 |
2016 |
| Debt Ratio |
49.90% |
58.10% |
|||
| Debt/Equity |
-187.82% |
-179.18% |
|||
| Times Interest Earned |
3.57 |
12.32 |
|||