At one time I had a smallish Scout Team position in Dutch Brothers Coffee - BROS. Interesting story: Two brothers - or so the tale goes - started selling coffee by walking around with a push cart of stuff - which naturally led to expansion into drive by sites with hundreds of locations. At least I think that how the story goes. So where are they today?
Website:
A Few Data Points:
Current Price: $36.43 (Intraday)
YTD Gain/Loss: +15.66%
52 WK Range: 22.67 - 38.41
Market Cap: $6.5B
BROS IPO’d way back in 2021 around midyear or so. The opening price was $36.68 - and now, a couple of years and some change later the company is slightly below that price. And - to get to todays Intraday price which is below its IPO price it had to produce a pretty dang good QTRLY Report - which it did. Here is that report:
To save some time on reading through any of that here is an opening quote from the CC:
“We delivered exceptional results in quarter one as the momentum we saw leaving 2023 continued into the new year. Headlining this performance was 10% same shop sales growth, the strongest single quarter since Q4 2021. We delivered $275 million in revenue, an increase of 39% year-over-year. These outstanding top-line results were coupled with excellent flow through as we delivered $53 million of adjusted EBITDA, an increase of 120% year-over-year.”
And then there was this:
" In quarter one, we opened a record tying 45 new shops, marking the eleventh consecutive quarter of 30 or more new shop openings, demonstrating remarkable consistency as we execute our growth plans."
Thats a whole lot of new coffee selling drive thru coffee kiosks.
Subsequent to that report the stock had to rally from $26.95 just to get within spitting distance of its IPO price way back in 2021. In short - Dutch Brothers Coffee has been a lousy investment. And - now that I remember it - a very smart Fool EarsLookin took about 30 seconds to review BROS and stated emphatically that it would never make money. Well - never can be a very very long time but Ears was right on target.
The Question now is simply this: after this beautiful, explosive Qtr is BROS a decent investment?
Nah.
All the Best,
BDH Investing