DA Davidson Starts Dunkin' Brands (DNKN) at Underperform; Priced for Perfection; Upside to Estimates Expected

DA Davidson initiates coverage on Dunkin' Brands (NASDAQ: DNKN) with an Underperform. PT $22.00.

DA analyst says, "Dunkin’ Donuts U.S. is the key to the story and positioned for continued success. The brand has grown sales productivity through effective product development, merchandising, and marketing. Comp store momentum should continue with the benefit of the K-cup rollout, which we estimate will add 4% to comps through 2013."

"Despite an attractive long-term growth opportunity, we cannot justify the current valuation. We are skeptical that the potential benefits from brand popularity and the excitement surrounding the IPO can be sustained."

For more ratings news on Dunkin Brands click here and for the rating history of Dunkin Brands click here.

Shares of Dunkin Brands closed at $28.05 yesterday.

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