Billionaire
Ken Fisher’s stock picks have outperformed the stock market. The positions of
his Fisher Asset Management have not
changed in size over the second quarter. Comparing the hedge fund’s 13F from Q2 with its Q1’s, we can see that a few stock
positions have increased by 2 per cent or decreased by 1 per cent and so
on, until we get a peek of Starbucks.
The holdings of Fisher Asset Management
of the coffee shops rose to 10m shares (for the end of June) from 550k (for the
beginning of April). The stock of
Starbucks rose with additional 8 per cent in 2012. It is also up 77 per
cent in comparison to 5 years ago and it has more than doubled in price for the
past 2 years. Another large position in Starbucks
is of Columbus Circle Investors with 3.6 m shares.
The third fiscal
quarter of Starbucks was characterized by
13 per cent increase in revenue in comparison with the third fiscal quarter in
2011. Marco watchers are worried about the American consumers and a common
debate is that whether American should spend 5 dollars for a cup of coffee.
Nevertheless, the segment of America reported 7 per cent same-store sales
growth. Moreover, the same-store sales have risen with 12 percent in
China/Asia-Pacific. Since many fixed costs were held in check, the net income
has increased with 19 per cent.
The revenue of
Starbucks has grown with 15 per cent and the
company’s net income has risen to 16 per cent in comparison to 2011.
Starbucks
is a growing business but the catch is that it carries a premium valuation. 27
is the number of the trailing price-to-earnings, and the estimation of forward
earnings is 20 per cent EPS growth
for 2013.
Starbucks
could be compared to other companies which share the same problems – Green
Mountain Coffee Roasters, which like Starbucks depends on the demand for
coffee, Dunkin Brands, McDonalds and Panera Bread.
Being
lampooned as a company which have locations that are within spitting distance
of one another, it has still managed to get down to serious business. Moreover,
it trumps both McDonalds and Dunkin in terms of recent growth.
A question for all you disciples/followers of Ken. He constantly states that where ever you plan to do with an annuity, there is a better way.
ReplyDeleteHere is my test:My lady friend is 55 and would like to stop working this year when she is fully vested in her company retirement plan. However that leaves about 10 years until such time.I can cover our daily living with now problem. My concern is how to cover her approx $400/month med insurance and some income for mad money. I was thinking of purchasing an $250K immediate annuity, so what is a better solution? neak5@rcn.com