Starbucks Corporation (SBUX), Dunkin Brands Group Inc (DNKN): 3 Beverage Companies With Strong Execution

The asset-light strategy executed by Dunkin’ Donuts seems to be working, as company revenues have been for the most part very strong. For six of the last seven quarters, Dunkin’ has had positive revenue growth, despite strong competition coming from the likes of Starbucks and other breakfast and beverage companies. Investors may see Dunkin’ as more of a food-sales store, but according to the most recent conference call, 60% of revenues are attributable to beverage sales, lining its business model up closely with powerhouses like Starbucks.

In past research, I’ve incorporated a Motley Fool Earnings Quality (EQ) Score, which taps into a database ranking individual stocks. The database designates an “A” through “F” weekly ranking, based on price, cash flow, revenue, and relative strength, among other things. Stocks with poor earnings quality tend to underperform, so we look for trends that might predict future outcomes.

Starbucks Corporation (NASDAQ:SBUX) currently earns an EQ score of C, while Jamba and Dunkin Brands Group Inc (NASDAQ:DNKN) are not currently ranked in our system. However, both companies are currently putting up very solid numbers and are looking increasingly efficient. Jamba’s distinct plan of marketing as a healthier choice looks to be gaining traction. If strong sales and management persists, the stock looks to be headed in the right direction.

The article 3 Beverage Companies With Strong Execution originally appeared on Fool.com and is written by John Del Vecchio.

Fool contributor John Del Vecchio, CFA, is the co-manager of the Ranger Equity Bear ETF and index provider to the Forensic Accounting ETF. He has no position in any stocks mentioned. The Motley Fool recommends Starbucks. The Motley Fool owns shares of Starbucks.

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