Dutch Bros. (BROS 4.28%) has been in the limelight over the past year, and not in a good way. Growth, while still positive, decelerated in each of the past four quarters, owing to the broader downturn in the restaurant industry. This weighed on the drive-through coffee chain, pushing its stock down 21% over the past year. That said, expectations were high going into the company's most recent financial report, and investors got an extra shot of growth.
For the fourth quarter, Dutch Bros generated revenue that jumped 29% year over year to $443.6 million, accelerating from 25% growth in Q3, its fastest growth rate in nearly a year. This drove impressive profit growth, with adjusted earnings per share (EPS) surging 143% to $0.17.
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The caffeinated results were driven by strong systemwide same-store sales, which increased 7.7%, while transactions improved 5.4%. Company-operated shops did even better, with same-store sales and transactions that grew 9.7% and 7.6%, respectively. This marked Dutch Bros' 19th consecutive year of positive same-store sales growth.
Dutch Bros continued its track record of having among the best unit-level economics in the industry, as its average unit volume (AUV) -- or average sales per location -- climbed to a record $2.1 million in 2025. For context, Starbucks -- which doesn't report the metric -- had an AUV of $1.8 million in 2024, according to QSR Magazine.
Dutch Bros continued its measured expansion, opening 55 new shops across 17 states during the quarter. That brought the total to 1,136 to close out 2025. Management is targeting 2,029 locations by 2029, which implies its location count will nearly double by then.
The company's outlook was robust. Dutch Bros is guiding for revenue of roughly $2 billion for 2026, or 23% growth, in line with analysts' consensus estimates. The company is also forecasting same-store sales growth of 3% to 5%.
NYSE: BROS
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CEO Christine Barone cited the company's record-breaking year, saying it was a "powerful testament to our culture, proving that the playbook of authentic human connection, industry-leading innovation, and incredible depth in field leadership is the ultimate engine for scaling this business." She went on to say the results were "an unmistakable indicator of the magnetic strength of the Dutch Bros brand."
The results went a long way toward reviving investor confidence, which was shaken by the restaurant industry downturn last year. The stock was up as much as 14% in after-hours trading (as of this writing), as investors cheered the reacceleration of Dutch Bros' growth.
The stock is richly priced at 102 times earnings, but Dutch Bros' rapid growth tends to skew the most widely used valuation metrics. The forward price/earnings-to-growth (PEG) ratio comes in at 0.34, when any number less than 1 is the standard for an undervalued stock.
That's why I believe Dutch Bros is a buy.
