Dutch Bros Inc. Class A Common Stock (BROS)

FairStock Score: 35/100 — MIXED

Key Financials

Strengths

• Solid return on equity of 14.1% above cost of capital
• Revenue growth of 29.4% demonstrates strong top-line momentum
• Established organization with 23,000 employees providing operational scale

Concerns

• Trades significantly above Graham Number ($9) with negative 532% margin of safety—limited downside protection

AI Analysis

Dutch Bros Inc. Class A Common Stock is a small-cap consumer cyclical company valued at $7.1 billion. The business generates $1.6 billion in annual revenue with a 1.3% net margin. From a quality standpoint, Dutch shows Altman Z-Score of 2.3 in the grey zone and adequate 14% ROE. On valuation, the stock is commanding a steep 85.2x multiple, with trades far above its Graham Number ($9) with no margin of safety. Growth dynamics show revenue growing at 29.4% and profit growth of 491.6%. Our composite FairStock Score of 35/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Dutch's 29% revenue growth trajectory could accelerate as it captures additional market share in the consumer cyclical sector. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

At 85x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer