Trade-Ideas: Dunkin Brands Group (DNKN) Is Today's New Lifetime High Stock
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.Trade-Ideas LLC identified Dunkin Brands Group (DNKN) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Dunkin Brands Group as such a stock due to the following factors:
- DNKN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $50.1 million.
- DNKN has traded 1.4 million shares today.
- DNKN is trading at a new lifetime high.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in DNKN with the Ticky from Trade-Ideas. See the FREE profile for DNKN NOW at Trade-IdeasMore details on DNKN: Dunkin' Brands Group, Inc., together with its subsidiaries, owns, operates, and franchises quick service restaurants under the Dunkin' Donuts and Baskin-Robbins brands worldwide. The stock currently has a dividend yield of 1.7%. DNKN has a PE ratio of 37.7. Currently there are 8 analysts that rate Dunkin Brands Group a buy, no analysts rate it a sell, and 9 rate it a hold.The average volume for Dunkin Brands Group has been 823,400 shares per day over the past 30 days. Dunkin Brands Group has a market cap of $4.7 billion and is part of the services sector and leisure industry. The stock has a beta of 0.40 and a short float of 8.5% with 4.94 days to cover. Shares are up 32.9% year to date as of the close of trading on Friday.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.TheStreetRatings.com Analysis:TheStreet Quant Ratings rates Dunkin Brands Group as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, premium valuation and weak operating cash flow.Highlights from the ratings report include:
- DNKN's revenue growth has slightly outpaced the industry average of 5.0%. Since the same quarter one year prior, revenues slightly increased by 5.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- DUNKIN' BRANDS GROUP INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, DUNKIN' BRANDS GROUP INC increased its bottom line by earning $0.94 versus $0.30 in the prior year. This year, the market expects an improvement in earnings ($1.53 versus $0.94).
- Powered by its strong earnings growth of 153.33% and other important driving factors, this stock has surged by 47.77% over the past year, outperforming the rise in the S&P 500 Index during the same period. Setting our sights on the months ahead, however, we feel that the stock's sharp appreciation over the last year has driven it to a price level which is now relatively expensive compared to the rest of its industry. The implication is that its reduced upside potential is not good enough to warrant further investment at this time.
- The debt-to-equity ratio is very high at 5.17 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, DNKN maintains a poor quick ratio of 0.91, which illustrates the inability to avoid short-term cash problems.
- You can view the full Dunkin Brands Group Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
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