So how good is good? Here are the highlights:
- Earnings per share increased 16%, excluding non-routine items.
- Same store sales increased abroad and domestically.
- The company boosted its dividend by 31%.
- Operating margin for the full year improved 150 basis points.
My favorite aspect of its performance is its same-store-sales improvement. Many companies are smartly hopping on the international-revenue bandwagon -- with competitor McDonald's
The rest of the class
With earnings for Caribou Coffee
Yet this is largely irrational, as most of the negative news surrounding Dunkin's earnings was related to its dilutive share offering, something that wouldn't directly affect Coffee Holdings. Furthermore, Coffee Holdings overwhelmingly distributes to Green Mountain Coffee roasters, not Dunkin', so there isn't a connection to justify the move.
To each his own
This has created opportunities for investors. As the market draws connections between one company's performance and transplants those expectations onto competitors, shares can get irrationally bid up or down. Starbucks' blowout earnings report was largely due to company-specific actions and a remarkably strong brand, not larger coffee-market swings. Investors would do well to notice any other companies that rode Starbucks' coattails as it shot up about 7% on Friday, and ask themselves whether the jump is justified and trade accordingly.
I recommend that investors add these companies to your watchlist using the following links and seeing how they fare over the next week as they report earnings.
Austin Smith owns shares of McDonald's. The Motley Fool owns shares of Starbucks. Motley Fool newsletter services have recommended buying shares of Green Mountain Coffee Roasters, Tim Hortons, McDonald's, and Starbucks, as well as creating a lurking gator position in Green Mountain Coffee Roasters. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.