After Hitting a New 52-Week High, Has Starbucks' Stock Gotten Too Expensive?

Core Viewpoint - Starbucks is facing challenges in growth despite its strong brand and recent leadership changes, with concerns about its stock valuation amidst ongoing economic uncertainties [1][4][7]. Group 1: Company Performance - Starbucks has experienced a slowdown in growth, with negative same-store sales for four consecutive quarters, indicating struggles in generating revenue from existing locations [3][4]. - The company appointed CEO Brian Niccol from Chipotle Mexican Grill to help turn around its business, but the effectiveness of these efforts is still uncertain [2][4]. - Recent earnings reports show that overall growth rates have not been impressive, raising concerns among investors [3][4]. Group 2: Stock Valuation - The stock has rallied over 20% in the past six months, reaching a 52-week high of $117.46, but this increase may have led to an overvaluation given the company's current challenges [2][5]. - Investors are currently paying 37 times the trailing earnings for Starbucks stock, which is considered expensive for a company struggling to generate growth [5][6]. - There is a perception that the stock may be priced with too much optimism, as the company has not demonstrated a clear path to revenue growth that justifies its high valuation [7][8].