BOSTON (TheStreet) -- Dunkin' Brands (DNKN), owner of the doughnut-and-coffee chain as well as ice-cream purveyor Baskin-Robbins, is set to go public. Millions of people in the Northeast can't get enough of Dunkin' Donuts coffee. So, how will its stock fare?First, the basics: The company, co-owned by private equity investors Bain Capital, Carlyle Group and Thomas Lee, is seeking to sell more than 22 million common shares between $16 and $18 a share for net proceeds of up to $400 million. Dunkin' amended its S-1, an initial public offering request form to the Securities and Exchange Commission, today. In it, Dunkin' indicated that it would have 126 million total common shares, after the share sale.
Going further, a pure-play franchise model allows Dunkin' to accelerate sales and profits without significant capital investment as franchisees bear upfront costs. Over a 10-year period, Dunkin' has increased its point of sales and revenue at annualized rates of 6.9% and 8.7%, respectively. Baskin-Robbins, itself, has experienced comparable success, having increased systemwide sales 5.1%, 9.8%, and 11% for 2008, 2009 and 2010, respectively. One remarkable statistic: Dunkin' U.S. generated 45 consecutive quarters of positive comparable-store-sales growth until the first quarter of 2008, proving the brand's value. With the majority of U.S. IPO buzz pertaining to social media, like social network Facebook, group-buying site GroupOn and online-game designer Zynga, a retail-food offering is a welcome respite to these difficult-to-value equities. Dunkin' is an IPO worth following and will be a stock that deserves consideration once trading commences. After all, Starbucks' and Tim Hortons' shares have advanced an outstanding 57% and 44% in 12 months.
-- Written by Jake Lynch in Boston.
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