Portfolio Managers: Honglu Liu Min Min Chen Rafi Qi He Presented April 17, /14/2015

Introduction SBUX Current $ GICS map: Industry: Coffee Production Founded in 1971 as a coffee bean roaster and retailer Strong customer loyalty (Not just coffee) 12/14/2015

Industry Overview Coffee consumers in the United States spending an approximated 9.2 billion dollars in the retail sector and 8.7 billion dollars in the foodservice sector every year. That is on average $ per year on coffee Source: 12/14/2015

Industry Overview

Industry Overview - External Driver 12/14/2015

Macroeconomic Souce:CapitalIQ Macroeconomic 12/14/2015

Market Cap : Billion P/E(ttm): Forward P/E: PEG Ratio: Week High: Week Low: /14/2015 Relevant Stock Market Prospects Source:

Relevant Stock Market Prospects 12/14/2015 Source: SBUX vs. S&P 500

12/14/2015 Relevant Stock Market Prospects Source: SBUX vs. NASDAQ Index

12/14/2015 Source: SBUX 10-k Relevant Stock Market Prospects

Business review 12/14/2015 Brand Portfolio Source: SBUX Company Profile

12/14/2015 Business review Source: SBUX &10-k Suppliers Coffee bean Other diary products Farmer Support Center Starbucks Products through Stores Grocery Warehouse club Food service etc Customers US 69% International 22% CPG 7% Others 2%

12/14/2015 Business review Source: SBUX 10-k

12/14/2015 Source: SBUX Q1 FY12 Store Counts By Country Business review % of stores globally

12/14/2015 Business review 17,244 stores globally Source: SBUX Q1 FY12 Store Counts By Country

12/14/2015 Business review Source: SBUX Q1 FY12 Store Counts By Country 17,244 stores globally

12/14/2015 Business review Source: SBUX 10-k

12/14/2015 Business review Source: SBUX 10-k

12/14/2015 Business review Source: SBUX 10-k

12/14/2015 Source: SBUX 10-k Business review

Financial Analysis Current Ratio Quick Ratio Cash Ratio /14/2015 Data Source: SBUX 10-K

Receivables Turnover Days Sales Outstanding Inventory Turnover Days Inventory on Hand /14/2015 Data Source: SBUX 10-K

Net Profit Margin 3%4%9%11% Gross Margin16%18%22%23% ROA6%7%16%18% ROE13%14%28%31% Interest Coverage /14/2015 Data Source: SBUX 10-K

ROE13%14%28%31% Tax Burden69%70%66%69% Interest Burden90%100%101%105% EBIT Margin5%6%13%15% Asset Turnover Leverage /14/2015 Data Source: SBUX 10-K

Key Statistics Closing price on 4/16/2012 : $ Annual EPS (ttm): 1.67 PEG ratio: 1.71 D/A = 1% P/E (ttm): P/E (forward): Implied 1-yr growth in EPS: 38.34% Graham g (5-7 year growth) : 13.61% Greenblatt profitability ratios: 1.EBIT/Tangible Assets = 46.67% 2.EBIT/ Enterprise Value= 3.8% = 50.47% 12/14/2015 Data Source: SBUX 10-K

Public Comparable Analysis PNRADNKNMCD Company Name Panera BreadDunkin’ Brands McDonald’s Corp Price per Share D/A0%28%11% P/E P/S P/BV EV/Revenue EV/EBITDA /14/2015 Value P/E $ % EV/EBITDA $ % EV/Revenue $ % P/BV $ % Final Value $ Data Source: Yahoo Finance

Financial Projection – DCF Analysis 12/14/ History Data: Balance Statement

12/14/ History Data: Income Statement Financial Projection – DCF Analysis

12/14/ WACC Financial Projection – DCF Analysis

12/14/ Assumption Financial Projection – DCF Analysis

12/14/2015 We use 10.5% WACC Base Scenario: $34.43 Upside Scenario: $58.75 Downside Scenario: $ Results Financial Projection – DCF Analysis

Recommendation Watch List 12/14/2015