Dutch Bros Inc. (NYSE:BROS) has garnered significant attention from investors, with an average recommendation of “Buy” from a group of twenty-two research firms, according to Marketbeat.com. Among these, three analysts provided a hold rating, while sixteen endorsed a buy recommendation, and three designated a strong buy. The consensus target price over the next year is approximately $77.39, reflecting optimism about the company’s growth trajectory.
Several prominent firms have recently provided insights into Dutch Bros’ stock performance. On October 16, Wells Fargo & Company reduced its target price from $80.00 to $70.00, maintaining an “overweight” rating. Similarly, Goldman Sachs Group adjusted its price target from $81.00 to $72.00, issuing a “neutral” rating on September 30. In contrast, Bank of America increased its target to $84.00 from $80.00, also assigning an “overweight” rating, reflecting confidence in the company’s prospects.
Recent Financial Performance
Dutch Bros reported its quarterly earnings on August 6, 2023, revealing earnings per share (EPS) of $0.26, surpassing analysts’ expectations of $0.18 by $0.08. The company achieved a net margin of 3.94% and a return on equity of 8.86%. Revenue for the quarter totaled $415.81 million, exceeding the consensus estimate of $403.24 million and reflecting a substantial year-over-year growth of 28.0%.
Analysts forecast an EPS of $0.57 for the current fiscal year, indicating continued growth potential for the company. The optimistic outlook is underscored by a strong historical performance, with the latest results building on a solid foundation.
Insider activity has also been notable. Major shareholder Dm Individual Aggregator, LLC sold 482,750 shares on August 22 at an average price of $65.17, totaling approximately $31.46 million. Following this transaction, they retained 1,279,144 shares, valued at around $83.36 million. Chairman Travis Boersma also sold 787,681 shares on August 25 at an average price of $68.94, amounting to about $54.30 million. This sale reduced his ownership by 44.69%, leaving him with 975,031 shares valued at roughly $67.22 million.
Institutional Investor Interest
The stock has attracted significant interest from institutional investors. In the first quarter, 1832 Asset Management L.P. increased its stake by 29.9%, acquiring an additional 788,100 shares to bring its total to 3,420,200 shares, valued at $211.16 million. Other firms such as Marshall Wace LLP and Invesco Ltd. have also expanded their holdings, indicating a positive sentiment towards Dutch Bros.
Currently, hedge funds and institutional investors control around 85.54% of Dutch Bros stock, underscoring strong confidence from the investment community. This robust backing is critical for the company as it continues to expand its market presence through its drive-thru coffee shops across the United States.
In conclusion, Dutch Bros Inc. is navigating a favorable landscape marked by positive analyst recommendations and robust financial performance. With a focus on growth and expansion, the company appears well-positioned to capitalize on its momentum in the competitive coffee market.
