Starbucks Financial Statements and Financial Ratios Analyzed from 2016 to 2020

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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 the 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 are 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. (Updated 2021)

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Starbucks 2020 Financial Report by Paul Borosky, MBA.
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Sample Financial Report

Sample Financial Report by Paul Borosky, MBA.
Financial Report Sample 2

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