Dutch Bros Is Hitting on all Cylinders But Be Careful if This Vital Metric Turns South

Restaurants have a habit of going in and out of favor. For example, coffee giant Starbucks (NASDAQ: SBUX) struggled to retain customers in fiscal 2025, with same-store sales down 2%. However, in the first quarter of fiscal 2026, it turned things around with a 4% increase in same-store sales.

Sales are the top-line number that most investors look at, but when it comes to restaurants, same-store sales tell you more about the business. This is why Starbucks' competitor, Dutch Bros (NYSE: BROS), is shining right now. Here's what you need to know and what you need to watch for as the tiny restaurant chain continues to expand.

Dutch Bros is hitting it out of the park

Dutch Bros increased its store count by 16% in 2025. That helped to drive the company's revenues higher by a huge 29%. But the real strength of the business showed up in its same-store sales, which rose in every quarter of the year. Same store sales were higher by 5.6% for the full period, ending the year with a huge 7.7% advance in the fourth quarter.

Image source: Getty Images.

Same-store sales show how stores that have been open for at least a year are performing. It is, basically, an indication of how well the company's core business is being operated. However, the changes are often modest in percentage terms compared to the impact of new store openings. That means operating weakness at a small company like Dutch Bros could easily be masked by new store openings.

Don't get wowed by the top line

Clearly, Dutch Bros is growing rapidly right now, driven by robust store openings and strong operating performance. It is great news, and growth-oriented investors should be very pleased. Notably, even after increasing the store count by 18% in 2025, the company still only operates 1,136 coffee shops. Starbucks operates over 40,000.

There is a huge opportunity for Dutch Bros to continue growing its quick-serve restaurant chain. However, it isn't uncommon for small restaurants to focus so heavily on new store openings that the performance of existing restaurants suffers. When that happens, some companies double down and try to open even more locations, which usually makes matters worse.

Dutch Bros is cheaper than it has been

Investor enthusiasm around Dutch Bros has waned, with the stock down more than 25% from its 52-week high. It isn't uncommon for relatively small, fast-growing businesses to see pullbacks like this. Given the company's strong business performance, more aggressive investors may be tempted to buy it. Just make sure you watch the top line and same-store sales, so you have a full picture of how the company's performance is really unfolding over time.

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Dutch Bros and Starbucks. The Motley Fool has a disclosure policy.