Q. Is Starbucks Corp. a good investment?—P.B., via the Internet

A. After two years of lay-offs and store closings, the coffee giant is feeling a buzz again.

Store traffic, earnings and new initiatives are all on the rise. Significant marketing for the firm's Via instant coffee and Frappucino drinks in grocery stores is underway, with new products to be rolled out over the next year and a half.

New stores in Asia, Europe and the US are contributing to its bottom line. In China, it has plans for rapid, targeted expansion, adding to its 700 stores already there. Meanwhile, in Seattle, it's testing a new upscale Roy Street Coffee and Tea store design.

Founder and chairman Howard Schultz returned as CEO in early 2008 following lacklustre 2007 results. Acknowledging that aggressive store growth had masked some underlying problems, Schultz set out to streamline the chain and launch new products through its stores and other sales channels.

Starbucks features a strong brand name in prime locations that has proven it can weather a deep recession.

Starbucks (SBUX) shares are up 18 percent this year following last year's 144 percent increase. After strong quarterly results, its board approved its first-ever dividend and a 15-million share buyback programme.

The chain has about 16,600 company-owned and licensed stores that sell coffee, espresso, teas, cold blended beverages, food items and coffee-related accessories. It also distributes through its Tazo, Seattle's Best Coffee and Torefazione Italia brands. It markets bottled beverages, ice creams and liqueurs through various partnerships.

As impressive as that is, Starbucks holds less than a 10 percent share of US coffee consumption and one percent globally, which indicates plenty of growth potential ahead. This time around, it intends to manage growth more judiciously.

The consensus recommendation on Starbucks shares from analysts who track them is "buy," according to Thomson Reuters. That consists of seven "strong buys," four "buys" and nine "holds."

Starbucks must cope with labour and commodity costs, competition from the likes of McDonalds Corp., the inherent cycles of the economy and some of the vagaries associated with international expansion. It is, however, strong financially with lots of cash and ample borrowing capacity.

Earnings are expected to rise 53 percent in the fiscal year ending in September and 14 percent in the following fiscal year. The five-year annualised growth rate is projected to be 16 percent, versus 14 percent forecast for the specialty eateries industry.

Q. What does a bond's coupon refer to?—C.B., via the Interne

A. The term coupon or coupon rate comes from the coupons attached to bond certificates that were redeemed when investors tore them off.

This was quite common years ago before electronic records became the norm. The terminology has stuck, at least among brokers and other professionals.

The coupon represents the rate the bond pays to the bondholder, meaning the interest you get from it. It is typically paid semiannually. For example, a $10,000 bond with a four percent coupon will pay $400 a year.

"The coupon is key to the bond, one of the primary considerations when buying one," said David Bendix, certified financial planner and CPA with Bendix Financial Group in Garden City, New York.

Zero-coupon bonds, on the other hand, do not pay interest, but are sold at the initial offering to investors at a price less than the par value. When held to maturity, the bond is redeemed for par value.

"Zero-coupon bonds aren't for investors looking for a current income stream because they have no interest payment until they mature," concluded Bendix. "You have to wait and then you get it all plus your initial investment."

Andrew Leckey answers questions only through the column. Address inquiries to Andrew Leckey, 555 N. Central Ave., Suite 302, Phoenix, Arizona. 85004-1248, or by e-mail at andrewinv@aol.com.