Dunkin' Brands' (
) stock price and dividends are on the rise as the doughnut and
ice cream retailer expands into new markets.
Profit and sales growth at the owner of Dunkin' Donuts and
Baskin-Robbins ice cream stores has also revived in the past two
Growth is being fueled by the company's expansion at home and
abroad as it bids to compete with rivals likeStarbucks (
) and Krispy Kreme (
Dunkin' announced plans last week to expand into the U.K. The
company is also expanding its menu to include sandwiches and
snacks while looking to set up shop in supermarkets, college
campuses and other nontraditional venues.
Dunkin' Brands went public in 2011 after being taken over by
three private equity firms. It began offering a quarterly
dividend of 15 cents a share in March 2012 and has since
increased the payout to 19 cents, or 76 cents annually.
The annual dividend yield is 1.7%, well below the S&P 500
average of 2.46%. That's because the stock has climbed nearly 40%
this year, more than double the S&P's increase.
Dunkin' is currently in a buying range after clearing a 45.35
buy point in a flat base Friday in huge volume. The stock's
Relative Strength line was near a new high as it approached the
buy point, a sign of strength.
The stock boasts 96 Composite and Earnings Per Share
Profit growth has picked up for two straight quarters, to 24%
in the latest period. But earnings for the current quarter are
seen rising just 16% to 43 cents a share. Sales growth is
expected to hold steady at about 6%.
Meanwhile, pretax margins are strong, but the company carries
a heavy debt load.