Financial website How Much looked at some of America's most popular stocks in 2007 to find out how much a $1,000 investment in each would be worth now. Turns out, coffee was a good bet: An investment of $1,000 in Starbucks in 2007 would be worth $4,687 as of October 31 this year, or more than four times as much.
Of the companies it examined, Starbucks's performance fell short of only , and the big winner, . An initial $1,000 investment in Netflix grew to a whopping $51,966 over that time period, according to How Much.
In the graphic below, the blue dots are equivalent to a $1,000 initial investment, and the pink dots equal the investment's current total value.
"The larger the pink circle, the more your investment is worth," How Much notes. "If the pink fits inside the blue, then you lost money. The [graphic] assumes that you took any dividend paid out in cash and did not reinvest into the company by buying more stock."
Any individual stock can over- or under-perform and past returns do not predict future results. Also, while Starbucks stock has recently performed well overall, some investors now have pause.
CNBC that the coffee chain's revenue fell below Wall Street expectations last month, initiating a new long-term outlook with reduced earnings estimates heading into 2018.
Chief executive officer Kevin Johnson says he's feeling good about meeting or exceeding those new targets. "The current environment that we're operating in and, with the work we're doing on throughput and innovation, we're optimistic we can exceed that," Johnson told
"This quarter alone, we have a strong holiday planned and we're already off to a good start. We're confident in our FY18 guidance and long-term guidance we've given."
He added, "When we get into [the] holiday and we sell billions of dollars worth of Starbucks gift cards, many of those gift cards translate into rewards members." Starbucks Rewards membership this year grew 11 percent and those customers accounted for 36 percent of sales.
David Tarantino, of wealth- and asset-management, capital-markets and private-equity firm Baird, says that if the company achieves its new long-term goals it will continue to be "within the top-quartile of revenue growth for S&P 500 Consumer Discretionary companies."
If you're thinking of investing in the stock market for the first time, veterans like Warren Buffett, Mark Cuban and Tony Robbins suggest you and consider index funds.
Index funds hold every stock in an index such as the S&P 500, including big-name brands like Apple and Microsoft, and offer low turnover rates, attendant fees and tax bills. They also fluctuate with the market, stay pretty constant and eliminate the risk of picking individual stocks.
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