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Starbucks and the Pitfalls of Investing in Turnaround Stocks

The Motley Fool
Summary
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78% Informative

Starbucks investors have been on a roller-coaster ride over the last few years .

The company's international exposure can be an advantage, but it also makes the company more difficult to turn around.

Investing in turnaround stocks implies that problems are solvable, rather than something being fundamentally wrong.

Starbucks is no stranger to reinventing itself.

Starbucks ' operating margins are at a 10-year low, excluding the brief pandemic-induced plunge.

The company's net long-term debt has skyrocketed in recent years -- roughly doubling from pre-pandemic levels.

It could realistically take years for Starbucks to return to meaningful growth and reduce its payout ratio.

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English

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short-lived

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