Why Dutch Bros Stock Plunged 41% at the Open Today
Shares of Dutch Bros (NYSE: BROS), a coffee-focused restaurant chain, fell dramatically at the open of trading on May 12, losing a huge 41% of their value in the first few minutes of the day. The big driver of the decline was the company's first-quarter 2022 earnings update, which was released after the close on May 11. It was clearly not a well-received report.
In some ways, Dutch Bros is doing just fine. For example, first-quarter 2022 revenues of $152.2 million were up an impressive 54% from the same period in 2021. That's not exactly shocking, however, given that the company has been opening locations at a rapid clip. In the first quarter alone it increased its store count by 34, all of which are company owned. This is what you expect from a fairly young restaurant company, with new locations basically juicing the top line. The problem is that top-line growth can sometimes hide problems on the bottom line.
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Source Fool.com
