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Smaller Coffee Chain Has Big Plans

Money & Markets Week Ahead Week of September 13, 2021: I disassemble the next Dutch Brothers Initial public offering (IPO) This quick service coffee company is looking to expand.

There are also some insights into other major inflation indicators.

Let’s see what to see last week on Wall Street:

Dutch Brothers IPO

After a bit of a dry spell, this week we’re ready to price some new IPOs.

One jumped out to me because it’s a business that moves America every morning. While I lived in Idaho, I often went to some of the places.

Dutch Bros Inc. A regional drive-through coffee chain based in Grants Pass, Oregon. We will set the price of the IPO on Thursday and trade on the New York Stock Exchange with the ticker symbol BROS.

what is that: Dutch Bros was founded in 1992. As of June 30, the company had 471 drive-through coffee shops that employ 7,876 people in 11 states. S-1 filing.. While 264 of these locations are franchises, Dutch Bros is focusing on retail stores for future expansion.

These small drive-through shops focus on the prompt service of a variety of hot and cold drinks, including coffee, espresso, energy drinks, lemonade, tea and even smoothies.

Dutch Bros prospered through 2020, increasing revenue by 37% to $ 327.4 million, according to S-1 filing.

IPO: The company plans to sell 21.1 million shares in the $ 18 to $ 20 per share price range.

I would like to raise $ 400 million in an IPO. At the midpoint of this range, Dutch Brothers has a market value of approximately $ 3.3 billion. Renaissance Capital.

Bank of America Securities, JP Morgan, Barclays, Jeffreys, Piper Sandler, William Blair and Baird are lead managers of the transaction.

skinny: It’s hard to recommend an IPO right away, but Dutch Bros is what I’m paying attention to.

It is expanding rapidly to some substantial markets on the West Coast and Texas. Added 53 locations in 2020, Scheduled to open 85 more by the end of this year.

As this expansion continues, some pain may increase, but the quick service drive-through coffee business model is solid, especially as more people return to work. Not to mention its biggest competition (Starbucks and Dunkin’Donuts), it’s catching up with drive-through games.

I will put this IPO on my list of candidates.

Data dump: Consumer price index

Inflation has been a hot topic throughout the COVID-19 pandemic and the subsequent economic recovery. The pandemic has resulted in unprecedented financial and financial reactions from governments around the world.

Now that large amounts of new money have flowed into the economy through various stimuli, consumers and investors alike want to know how inflation is forming.

monthly US Core Consumer Price Index (CPI) It provides some insights. The US Bureau of Labor Statistics will release August data on Tuesday.

The Core Index measures monthly price fluctuations for goods and services, excluding food and energy. Price changes are from the consumer’s point of view.

Core CPI surged from April to June as the COVID-19 vaccine became more widely available and the economic recovery accelerated. July figures have cooled slightly, with all items except food and energy up 0.3%.

Prices for these core items have risen 4.3% in the last 12 months to July 2021.

skinny: The Federal Reserve Board calls this a period of “temporary” inflation, and expects inflation to eventually return to its target of 2%. But it’s hard to imagine that it will happen soon.

economist We expect August’s core CPI to be around 0.3% again, but in the end, these high prices could set a new standard. Core CPI has been negative for only four months over the last five years, three months during the COVID-19 pandemic last summer when no one was spending money.

Price increases may cool a bit in the coming months, but I wouldn’t expect things to get cheaper from here.

Revenue report

Finally Money & Markets Week AheadLet’s take a look at some keys here Revenue This Week’s Report:

Monday

Oracle Corp. (NYSE: ORCL)

MaxCyte Inc. (Nasdaq: MXCT)

Mission Produce Inc. (Nasdaq: AVO)

Tuesday

Core & Main Inc. (NYSE: CNM)

Skillsoft Corp. (NYSE: skill)

Wednesday

JinkoSolar Holding Company Limited (NYSE: JKS)

Weber Inc. (NYSE: WEBR)

Thursday

Cooking Solutions Inc. (OTC: CUSI)

Fonar Corp. (Nasdaq: FONR)

Friday

Franklin Wireless Corporation (Nasdaq: FKWL)

Spectrum Group International Inc. (OTC: SPGZ)

Sears Holdings (OTC: SHLDQ)

Best investment,

Chadstone

Assistant Managing Editor, Money & Market

PS Live on September 23, Adam O’Dell reveals details of a simple two-day transaction that we believe is the fastest way to make money ever devised. That is a big claim. Can you prove it? Sign up for the event here and check it out on September 23rd.

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