Dutch Bros (BROS) Stock Falls Amid Market Uptick: What Investors Need to Know

Zacks
03-22

Dutch Bros (BROS) closed at $65.43 in the latest trading session, marking a -0.09% move from the prior day. The stock trailed the S&P 500, which registered a daily gain of 0.08%. On the other hand, the Dow registered a gain of 0.08%, and the technology-centric Nasdaq increased by 0.52%.

Shares of the drive-thru coffee chain operator and franchisor have depreciated by 20.16% over the course of the past month, underperforming the Retail-Wholesale sector's loss of 9.1% and the S&P 500's loss of 7.33%.

The upcoming earnings release of Dutch Bros will be of great interest to investors. In that report, analysts expect Dutch Bros to post earnings of $0.12 per share. This would mark year-over-year growth of 33.33%. Alongside, our most recent consensus estimate is anticipating revenue of $341.56 million, indicating a 24.16% upward movement from the same quarter last year.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $0.62 per share and a revenue of $1.58 billion, signifying shifts of +26.53% and +23.37%, respectively, from the last year.

Investors should also note any recent changes to analyst estimates for Dutch Bros. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 1.46% downward. Dutch Bros currently has a Zacks Rank of #3 (Hold).

With respect to valuation, Dutch Bros is currently being traded at a Forward P/E ratio of 105.87. This signifies a premium in comparison to the average Forward P/E of 23.19 for its industry.

Also, we should mention that BROS has a PEG ratio of 3.12. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Retail - Restaurants industry had an average PEG ratio of 2.12 as trading concluded yesterday.

The Retail - Restaurants industry is part of the Retail-Wholesale sector. Currently, this industry holds a Zacks Industry Rank of 140, positioning it in the bottom 45% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research

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