Dutch Bros Just Flipped the Script With a Massive Earnings Beat

Who needs coffee? Dutch Bros Inc. (NYSE: BROS) is giving investors a rush as BROS stock is up over 20% in mid-day trading after the company delivered a strong earnings report after the market closed on August 6.

The headline numbers were impressive in and of themselves. Dutch Bros reported $415.81 million in revenue, topping the $403.24 million forecasted.

The number was also 27.9% higher year-over-year (YOY). The same was true of earnings per share (EPS), which came in at 26 cents, beating expectations by 44%. The number was also 36.8% higher YOY.

Dutch Bros also raised its full-year revenue and earnings guidance. The company now expects to deliver $1.59 billion to $1.60 billion in revenue and $285 million to $290 million in adjusted EBITDA.

BROS stock was already up approximately 20% in 2025 before the earnings report. This reflected investor enthusiasm for the company’s expansion plans and strong financials.

However, the stock was down more than 10% in the month before earnings. It continued to drop after Starbucks Corp. (NASDAQ: SBUX) delivered a mixed earnings report. Stocks in the same sector, in this case retail stocks, especially mid- and small-caps, often trade in sympathy with larger peers, particularly with institutional funds that reweight baskets.

A Case of Mistaken Identity?

That’s where the opportunity lies. Although its fans may disagree, Dutch Bros still has challenger brand status compared to Starbucks, which is still perceived as the category leader. That’s OK. Investors of a certain age remember that Avis built its company as a challenger brand to industry leader, Hertz.

But while the two companies may trade together, their business models and trajectories are quite different. Dutch Bros is earlier in its growth curve, and that gives it a unique edge that Starbucks no longer carries.

For example, Dutch Bros opened 31 new locations in the quarter, including entering its 19th state. It also reiterated its outlook that it will open 160 locations in 2025 with a long-term goal of having over 2,000 locations by 2029.

And, unlike Starbucks, which reported a same-store sales decline of around 3%, Dutch Bros delivered 6.1% same-store sales growth in the quarter. Dutch Bros is also leaning into a younger demographic audience, which is partially reflected in the company’s drive-thru-only business model.

Can the Growth Continue?

After such a strong run-up in 2025, some investors may wonder if BROS stock has limited upside. There are at least two reasons to believe it may have room to run.

First, it’s nearly impossible not to notice the dramatic YOY free cash flow (FCF) growth. In the quarter, Dutch Bros reported $46 million in FCF. In the same quarter in 2025, it posted a $32 million cash burn. That’s a $78 million swing and a strong indicator that the company is now delivering profitable growth with operating leverage.

Investors can also look at the Dutch Bros analyst forecasts on MarketBeat. The stock has a consensus price target of $77.82, which is a 13% gain. Within 24 hours of the earnings report, four analysts raised their price targets on BROS stock. Three of them now see the stock trading above the current consensus price.

This Could Be the Breakout Investors Have Waited For

After weeks of trending lower into the earnings report, BROS stock has surged above its 50-day simple moving average (SMA), a key technical milestone that signals renewed bullish momentum. Confirming the bullish move is the bullish crossover in the moving average convergence/divergence (MACD) indicator.

That 50-day line now acts as near-term support.

There could be resistance in the $73-$75 range, where the stock peaked in June. However, technicians often say, “The longer the base, the stronger the breakout.” BROS has been consolidating since June, so if it can push above that level, a retest of the $80 high could be in sight.

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The article "Dutch Bros Just Flipped the Script With a Massive Earnings Beat" first appeared on MarketBeat.