Starbucks Corporation

“Starbucks has a durable brand and a credible new CEO, but the investment case is undermined by margin collapse, a dividend that exceeds free cash flow, nearly 5x net debt/EBITDA, structural competitive losses in China, and a valuation of ~42x forward earnings that prices in perfect turnaround execution — leaving essentially no margin of safety and limiting 10-year returns to roughly 2x even in the optimistic scenario; the risk of permanent capital impairment is material, not theoretical.”