7 Reasons to Consider Buying Dutch Bros Over Starbucks: A Growth Opportunity for Investors

Based on the analysis presented, the author argues that investors should consider buying the stock of Dutch Bros instead of Starbucks. The author highlights several reasons for this recommendation:
1. Dutch Bros has shown impressive growth in recent years, with same-store sales increasing by 10% and overall revenue growing by 40%. In contrast, Starbucks experienced a decline in same-store sales and revenue growth that was flat.
2. Dutch Bros is expanding rapidly and has a long way to go before it achieves the scale of Starbucks, which operates in 80 countries. This presents a significant growth opportunity for investors.
3. Despite being less expensive than Starbucks based on price-to-sales (P/S) multiples, Dutch Bros is still a financially robust operation with strong organic growth and a positive outlook.
4. The author notes that consumers are becoming more cost-conscious due to inflation and rising interest rates, and Dutch Bros may be gaining market share from Starbucks due to its perceived lower prices.
5. The author acknowledges that Dutch Bros is currently a little pricey, but believes that long-term investors will still enjoy significant upside given its strong performance and growth potential.
6. As part of its Consumer Discretionary sector coverage, The Motley Fool’s Stock Advisor service has recommended 10 stocks that could generate significant returns for investors. Dutch Bros did not make the list, but the author encourages readers to explore this resource for investment ideas.
7. The author concludes that while Starbucks is facing challenges, Dutch Bros represents a compelling alternative for investors seeking growth opportunities outside traditional sectors like technology, healthcare, or energy. Readers are advised to conduct their own research before making investment decisions.