Dunkin' Brands, the parent company behind Dunkin' Donuts and Baskin-Robbins Ice Cream, reported earnings on Thursday that were in line with Wall Street's expectations.
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CREDIT SUISSE: There are 3 reasons to be optimistic about Dunkin' Donuts (DNKN)
Dunkin' Brands' same-store-sales were lackluster in the first quarter, but Credit Suisse sees three silver linings.
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Dunkin' Brands' lackluster SSS results didn't Credit Suisse, and the bank is still bullish on the donut and coffee chain's stock. It has a price target of $61 per share for Dunkin', above the firm's current market price of $56.56 per share.
The bank identified expected improvements in SSS later in the year as one reason for investors to stay bullish on the stock.
"On Dunkin' US SSS, we maintain 2Q17E at +2% but lower our 3Q/4Q to +1.5% (from +2.0%) to reflect the lap of Cold Brew on Aug. 1 and limited visibility into impact of expanded menu simplification test," the bank said.
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In February Dunkin' announced it would begin tests on a simplified menu at 300 of its stores to increase speed and efficiency and, in turn, improve sales.
Credit Suisse noted two other reasons to stay optimistic. They are as follows:
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