IFB129: A Sip of Starbucks Balance Sheet

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Dave:                                    00:36                     All

right folks, welcome to the Investing for Beginners podcast. This is episode

129 tonight. Andrew and I are going to go back to the well, and we’re going to

answer a listener’s question. We got a great one the other day, and Andrew

thought this would be a great conversation for us to have with you guys, so I’m

going to go ahead and read the question, and then Andrew will take the first

stab at it. All right, so here we go. I have been practicing using the VTI

Excel sheet and pick Starbucks since they are a large company that has been

around for a while and doesn’t seem to be going anywhere. When I input their

numbers into the spreadsheet, it put on a VTI of 1428 I see. They have more way

abilities than assets. Their dividend has decreased from last year, and their

shareholder equity seems to be in a negative. Yet when I read articles online,

they say it as a good buy. How do you reconcile these articles with the data we

are receiving through the VTI process. Thank you, and love all the content.

Andrew, what are your thoughts on this?

Andrew:                              01:35                     Yeah,

super good question. First off, and I think there’ll be a lot of fun to talk

about Starbucks and take a deep dive into it. Just for kind of clarification

for people who don’t know what the listener is talking about, we need to says

VTI that stands for value trap indicator. It is a formula that I created and

use on every stock I buy. And so basically it takes some of the financial

numbers around the company and does some calculations and tells you generally

whether it’s a good buy or not. So 1428, that’s a very high number in the range

of VTI world. That’s definitely like in strong sell territory or at the very

least, do not buy a territory. So I think you know it. It’s a great question

and a great thing to think about. Because you have, you have on let, let’s

start maybe with a disclaimer.