SBUX same store sale are expected to increase over the next few years as China's middle class doubles, but are currently flat to slightly negative.
In spite of same-store sales in China falling, SBUX revenue is up 20% in China due to the opening of new stores at a rate of one shop every 15 hours in China.
China has recently partnered with Alibaba to gain marketshare in the online delivery of coffee , but there remains some competition with the first Chinese coffee unicorn partnering with Tencent for delivery services and customer analytics.
On average, same-store sales are only increasing at a pitiful 3%, but is expected to remain positive for the foreseeable future.
Relative to the market, SBUX is undervalued. A PE of 24 or so would be more ideal, which would is 33% higher than it's current PE of 18. Assuming current expectations and growth remains above 10%, that would add another 10% on a PE of 24 next year, putting my PT at about $88, and near around $100 by the Jan 2020 options expiration.
Given 9/33 analysts have a rating of HOLD, 14/33 analysts have a rating of BUY, and 10/33 analysts have a rating of STRONG BUY, with 0/33 analysts have a rating of SELL, I think SBUX will grow into its industries average PE or a bit higher at around 24.
SBUX is on the verge of breaking above it's bear trend into a one.
2020 Jan 17, Strike $75 calls could have an upside of 2,000% ($1 to $20+) if the break above it's bear trend occurs in the next month or so and it's quarter to quarter upward trend is sustained into the long-term.