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5i Recent Questions
Q: A Market Call guest, Gordon Reid, was very negative on SBUX, saying that they are wrong to borrow money to buy back stock. I disagree. With a return on assets of 14% and a dividend that is well covered by earnings, I would argue that loading the balance sheet with low-cost debt to maximize return on equity is a sound strategy. Who's right?
Q: The market clearly likes the new CEO, do you? Does this change your view on SBUX? Or might this be a good time to sell and reevaluate the company after a while? Thank you.
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Which one to keep and which one is sell?
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