NEW YORK (TheStreet) --Shares of Dunkin Brands Group Inc. (DNKN - Get Report) are higher by 1.16% to $44.56 in pre-market trading on Wednesday, following a ratings upgrade to "overweight" from "equal weight" at Barclays (BCS) .
The firm said it raised its rating on the Dunkin Donuts and Baskin-Robbins franchisor due to the company's compelling long term fundamentals, and an attractive entry point based on Dunkin's current price.
Barclays upped its price target on the stock to $51 from $48.
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Separately, TheStreet Ratings team rates DUNKIN' BRANDS GROUP INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate DUNKIN' BRANDS GROUP INC (DNKN) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, expanding profit margins and good cash flow from operations. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 5.4%. Since the same quarter one year prior, revenues slightly increased by 4.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- DUNKIN' BRANDS GROUP INC has improved earnings per share by 13.2% 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 two years. We feel that this trend should continue. During the past fiscal year, DUNKIN' BRANDS GROUP INC increased its bottom line by earning $1.36 versus $0.94 in the prior year. This year, the market expects an improvement in earnings ($1.75 versus $1.36).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Hotels, Restaurants & Leisure industry average. The net income increased by 13.2% when compared to the same quarter one year prior, going from $40.81 million to $46.19 million.
- The gross profit margin for DUNKIN' BRANDS GROUP INC is currently very high, coming in at 78.28%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 24.19% is above that of the industry average.
- Net operating cash flow has significantly increased by 58.82% to $58.06 million when compared to the same quarter last year. In addition, DUNKIN' BRANDS GROUP INC has also vastly surpassed the industry average cash flow growth rate of -21.67%.
- You can view the full analysis from the report here: DNKN Ratings Report
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