Tuesday, January 17, 2006

Starbucks

Around lunch time I made a quick jaunt to the nearest Starbucks to pick up a bracing cup of coffee. As I seem to have graduated from erratic sleep patterns to not sleeping at all at nights a strong cup of mid-day coffee to bolster me is a must to get me through the day. While I was waiting my turn at the counter I suddenly noticed something. Could it be? Yes, there they were. Lovely glowy pale pink coffee cups. I picked them up. There were little pink hearts on the bottom. Although I realize that the proximity to Valentine's Day may have something to do with the appearance of candy colored hearts everywhere I think this is a solid financial move on the part of the company. Now this may seem silly to some people but to the millions of women all around the world who paint their bedrooms pink and buy matching towels this softens the stern, black-coffee image of Starbucks and makes it a little more approachable, which one hopes can only result in more sales. They are no longer the purveyors of just that bitter nectar of life that helps so many of us get through but they now provide color therapy.

I am seriously considering buying some stock in Starbucks. It may not be such a financially bad move. Acc to my Morningstar premium report, the future for Starbucks looks bright provided investors can temper their expectations with a realistic look at the future of coffee. The current selling price is lower than the fair value estimate, and at $30.01 a lot more affordable than BRKB which has still to earn its keep, at least in my portfolio. I may just go for it.

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