More From Matthew Krikorian
Must know: How coffee price affected Dunkin’ Brands
The performance of the coffee industry as a whole is less affected by coffee commodity price movements than the typical investor might expect.
Q4 discussion: What went well for Dunkin’ Brands
Over 70% of Dunkin’ Revenues are generated from Dunkin’ Donuts U.S. segment franchise fees.
Coffee industry: A brief overview
Coffee industry so far: Dunkin beat both analysts’ earnings and revenue estimates; Starbucks beat earnings estimates in 1Q14 by two cents (2.7%).
Opportunities and risks that Dunkin’ Brands investors must know
It’s no big secret that Dunkin’ Donuts has the highest relative leverage in the industry. Leverage comes with a number of risks— a substantial risk is the interest paid on debt.
Stock pick: Why Dunkin’ Brands has performed exceptionally well
Dunkin’ Brands’ gross margin has been declining, but at the same time, operating margins have been on the rise. Gross margin is largely affected by increases in the production costs of ice cream.
Why Dunkin’ Brands is a unique player in a maturing industry
Dunkin’ Donuts’ main competitor on the coffee sales front is Starbucks, which sells coffee from its company-owned fleet of retail locations.
International presence: Dunkin’ brands’ positive global outlook
Dunkin’ Brands have had an international presence since 1961’s introduction into the Canadian market. Currently, their key markets for both brands are in Asia and the Middle East.
An industry advantage: Dunkin’ Brands’ operating costs are dieting
Dunkin’ Brands has a very low capital requirement relative to the rest of the coffee retail industry. This is due to its business model, centered around establishing franchises across the world.
Must-know: Dunkin’ Brands is innovating the supply chain
Dunkin’ Brands Group doesn’t typically supply products to its franchises. Revenues derive from royalty fees as opposed to product distribution.
Must-know: Which of Dunkin’s segments have upside potential?
Dunkin’ Donuts is an industry leader of the quick-service restaurant (or QSR) concept. Its products include coffee, donuts, bagels, muffins, and breakfast sandwiches.
Why does “the Starbucks Experience” influence consumers?
In addition to international expansion, Starbucks executives push the importance of the consumer experience. Essentially, the firm is dynamically changing its impressions by always offering something new.
SBUX stock performance: Why you know the Starbucks name
Since the 2009 recession, the company has sharpened its focus on increasing international store count to mitigate the risks attributable to local unfavorable economic conditions.
Must-know risks: Why Starbucks should hedge its shrubs
Starbucks indicates that it uses derivative contracts to hedge commodity price risks. These contracts typically don’t have a lifespan longer than five years.
Understanding Starbucks’ cost structure and operating expenses
Starbucks’ main cost driver is its price per pound of coffee beans. The two most consumed coffee beans are Arabica and Robusta blends.
A Starbucks on every corner: A guide to the SBUX business model
This business model has allowed Starbucks to be the first coffee firm to put retail locations in each of the BRIC nations and many more.
Starbucks revenues: Why customers are willing to pay a premium
Starbucks’ revenue mix is weighted in favor of beverages. This should come as no shock, considering the firm’s roots trace back to a single coffee shop at Pike’s Place Market in Seattle.
Business overview: Why Starbucks deserves your attention
Starbucks began in 1971 as a single coffee shop in Seattle. Today, it’s the world largest coffee retailer, with over 19,000 locations in more than 60 countries (as of FY2013 end).