Starbucks (SBUX) Has Fallen 15% in Last One Year, Underperforms Market

If you are looking for the best ideas for your portfolio you may want to consider some of Wedgewood Partners top stock picks. Wedgewood Partners, an investment management firm, is bullish on Starbucks Corp (NASDAQ:SBUX) stock. In its Q2 2019 investor letter – you can download a copy here – the firm discussed its investment thesis on Starbucks Corp (NASDAQ:SBUX) stock. Starbucks Corp (NASDAQ:SBUX) is a chain of coffeehouses and roastery reserves.

On July 16, 2019, Wedgewood Partners had released its Q2 2019 investor letter. The investment firm said that Starbucks Corp (NASDAQ:SBUX) was one of the biggest contributors to its performance in Q2 2019. The stock has posted a return of -14.9% in the trailing one year period, underperforming the S&P 500 Index which returned 20.5% in the same period. This suggests that the investment firm was wrong in its decision. On a year-to-date basis, Starbucks Corp (NASDAQ:SBUX) stock has fallen by 5.5%.

Wedgewood Partners fund posted a return of 4.3% in the second quarter of 2019, in-line with the S&P 500 Index which also returned 4.3% in the same quarter. Let’s take a look at comments made by Wedgewood Partners about Starbucks Corp (NASDAQ:SBUX) in the Q2 2019 investor letter.

“Starbucks rounds out our top performers as the Company reported steady growth in its two largest markets – the U.S. and China – both of which are the focus of the Company’s current expansion plans. We continue to believe the Company can achieve double-digit growth through its planned store expansion, modest growth in its existing store base, margin improvement, and its capital return program.”

Last month, we published an article revealing that Polen Capital Management is bullish about Starbucks Corp (NASDAQ:SBUX) stock. The investment firm believes that the company would emerge stronger from the COVID-19 crisis.

In Q1 2020, the number of bullish hedge fund positions on Starbucks Corp (NASDAQ:SBUX) stock increased by about 3% from the previous quarter (see the chart here), so a number of other hedge fund managers seem to agree with Starbucks’ growth potential. Our calculations showed that Starbucks Corp (NASDAQ:SBUX) isn’t ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 185% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 109 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

At Insider Monkey we scour multiple sources to uncover the next great investment idea. Currently, investors are pessimistic about commercial real estate investments. So, we are checking out this contrarian play to diversify our market exposure. We go through lists like the 10 most profitable companies in America to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. You can subscribe to our free enewsletter below to receive our stories in your inbox:

Disclosure: None. This article is originally published at Insider Monkey.