Motley Fool analyst likes growing U.S. coffee chain Dutch Bros on dip

Dutch Bros, a small U.S. coffee chain, is a growth stock that "could supercharge your returns over the next five years and beyond," argues Motley Fool contributing analyst Neil Patel. The company’s stock is trading about 45% below its peak even as its fundamentals remain strong, he says, creating an attractive entry point for investors.

Dutch Bros’ fundamentals remain solid, including steady growth in same-store sales, Patel writes. This sets the company apart from peers, the article suggests. The Dutch Bros chain currently operates 1,136 locations, Patel noted.

For 2025, Dutch Bros reported revenue growth of nearly 28% to $1.64 billion, while same-store sales rose 7.4%. Net income surged 76% over the period to $117.3 million. Patel describes the financial performance as impressive.

He also points to Wall Street forecasts that earnings per share will grow at an average annual rate of 27.4% over the next three years – faster than revenue growth. Dutch Bros itself guides for sales to increase 22-24% to $2.00-2.03 billion in 2026.

Among the risks for investors, Patel cites the possibility of a drop in sales. Another concern, he says, is the high volatility of Dutch Bros shares over the last several years. For that reason, the analyst says the stock is for "investors who can handle the ups and downs and have patience to buy and hold for several years are in a good position to profit."

Year to date, Dutch Bros shares have fallen almost 17%.

The company’s stock has 19 “buy” ratings from Wall Street analysts versus just one “hold.” The average target price is $78.20 per share, about 54% above the stock’s closing price on Wednesday.