Dunkin Brands Group shares gain the most in two years on Thursday, third-quarter profit tops estimates, full-year earnings forecast revised up

November 1, 2019 10:19 am

Dunkin’ Brands Group Inc’s (DNKN) third-quarter earnings, reported on Thursday, exceeded Wall Street estimates, as expenses decreased. The company also revised up its full-year earnings forecast, as it bet on delivery improvement and the addition of new menu items.

Shares of Dunkin Brands Group closed higher for the sixth time in the past nineteen trading sessions on NASDAQ on Thursday. It has also been the sharpest daily surge since October 30th 2017. The stock went up 6.27% ($4.64) to $78.62, after touching an intraday high at $78.83, or a price level not seen since October 11th ($78.99).

Shares of Dunkin Brands Group Inc have risen 22.61% so far this year, following a 0.54% drop in 2018.

Sales at Dunkin’ stores in the United States, which are open for at least 12 months, went up 1.5% year-on-year during the quarter ended on September 28th, falling short of market consensus of a 1.7% growth. The company struggled to lure customers in the saturated US breakfast and coffee market.

Dunkin’ Brands Group’s general and administrative expenditures were reported to have shrunk 6% year-on-year during the past quarter.

Meanwhile, net income attributable to shareholders went up to $72.4 million ($0.86 per share) during the third quarter from $66.1 million ($0.79 per share) in the year-ago period.

Earnings per share, which exclude special items, were reported at $0.90 during the latest quarter, while exceeding a consensus of estimates of $0.81 per share.

Dunkin’ Brands Group also raised its full-year adjusted earnings forecast to a range of $3.10 to $3.12 per share from a previously expected range of $3.02 to $3.05 per share.

Analyst stock price forecast and recommendation

According to CNN Money, the 19 analysts, offering 12-month forecasts regarding Dunkin’ Brands Group Inc’s stock price, have a median target of $79.00, with a high estimate of $95.00 and a low estimate of $67.00. The median estimate represents a 0.48% upside compared to the closing price of $78.62 on October 31st.

The same media also reported that at least 21 out of 28 surveyed investment analysts had rated Dunkin’ Brands Group Inc’s stock as “Hold”, while 5 – as “Buy”. On the other hand, 1 analyst had recommended selling the stock.

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