Starbucks vs Ford Motor Which Is More Promising?

Starbucks and Ford Motor are two well-known companies operating in vastly different industries. Starbucks is a global coffeehouse chain renowned for its high-quality beverages and cozy atmosphere, while Ford Motor is a major player in the automotive industry with a long history of producing durable vehicles. Both companies have a strong presence in the stock market, but their performance and potential for growth may vary due to the distinct nature of their businesses. Investors should carefully consider factors such as consumer trends, industry regulations, and financial stability when comparing Starbucks and Ford Motor stocks.

Starbucks or Ford Motor?

When comparing Starbucks and Ford Motor, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Starbucks and Ford Motor.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Starbucks has a dividend yield of 2.38%, while Ford Motor has a dividend yield of 7.51%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Starbucks reports a 5-year dividend growth of 10.35% year and a payout ratio of 68.73%. On the other hand, Ford Motor reports a 5-year dividend growth of 11.36% year and a payout ratio of 88.50%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Starbucks P/E ratio at 29.46 and Ford Motor's P/E ratio at 11.71. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Starbucks P/B ratio is -14.87 while Ford Motor's P/B ratio is 0.93.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Starbucks has seen a 5-year revenue growth of 0.75%, while Ford Motor's is 0.09%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Starbucks's ROE at -46.35% and Ford Motor's ROE at 8.13%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $96.94 for Starbucks and $10.32 for Ford Motor. Over the past year, Starbucks's prices ranged from $71.55 to $103.32, with a yearly change of 44.40%. Ford Motor's prices fluctuated between $9.49 and $14.85, with a yearly change of 56.48%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.