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Q4 Preview: Shareholder Payout, K-Cup Sales Will Be In Focus on Dunkin' Brands (DNKN) Call

February 8, 2012 6:29 PM EST
DNKN Hot Sheet
Rating Summary:
    8 Buy, 8 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 0 | Down: 0 | New: 0
Shares of Dunkin' Brands Group (Nasdaq: DNKN) closed up 0.73 percent Wednesday ahead of the release of its fourth-quarter results before the opening bell on Thursday, February 9th.

The Wall Street quarterly consensus for Dunkin' Brands Group is $0.28 per share in earnings on $160.05 million in revenue.

For the full year 2011, analysts on the Street are currently estimating $0.92 per share in earnings on $618.71 million in total sales.

The fourth quarter conference call is scheduled for 8:00 am ET on February 9th.

According to data from Bloomberg, shares of Dunkin Brands Group have seven Buy ratings, seven Hold ratings and zero Sell ratings. The average price target on shares of DNKN is $29 with a range from $24 to $33.

Analyst Comments:

Goldman Sachs believes the company will beat earnings expectations on 5.7 percent same-store sales growth. For the quarter, the firm forecasts earnings of $0.30 per share. Goldman also noted K-Cup sales were should be strong.

During the conference call, the firm anticipates management will discuss its plans to return its excess cash flows to shareholders by either a dividend or through buybacks.

Goldman reaffirmed its Neutral rating on the company going into the release as its valuation is somewhat stretched.

DA Davidson is also bullish ahead of the quarter as it forecasts earning of $0.30 per share on $168.1 million in revenue. The firm’s same-store sales estimate of 4.5 percent may prove to be conservative.

The firm noted some of the key topics during the conference call should include: K-Cup trends, New product pipeline news, The pace of franchise renewals, 2012 guidance, Does management have a strategy to counter Starbucks introduction of the blonde roast?

Going into the release, DA Davidson reiterated its Neutral rating and $26 price target.


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