Better Buy: Starbucks vs. Dutch Bros Stock
Key Points
Starbucks is demonstrating impressive progress in its turnaround plans, and it pays a dividend with an attractive yield.
Dutch Bros is growing at a fast pace and has large expansion opportunities.
Both stocks trade at similar P/E ratios.
You might think that Starbucks (NASDAQ: SBUX) and Dutch Bros (NYSE: BROS) are similar companies, since both operate coffee shop chains. But they differ in important ways, such as the kinds of beverages they serve, and they're at vastly different points on their journeys.
Starbucks is already a global powerhouse, while Dutch Bros is just getting started. Which one is the better buy today?
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
Image source: Getty Images.
The case for Starbucks: Stability and passive income
Starbucks is the largest coffee shop chain in the world and one of the largest restaurant chains in the world, with more than 41,000 stores. It has more than $38 billion in trailing 12-month sales and $1.5 billion in trailing 12-month net income.
Although Starbucks has struggled over the past few years, its turnaround plan is starting to demonstrate results. In the 2026 fiscal second quarter (ended March 29), sales were up 9% year over year, and comparable sales (comps) were up 6.2%. Those numbers tell investors (at least) two important things: The company is still successfully opening new stores, hence the total sales outpacing the comps, and that revenue growth isn't coming only from new stores, but from loyal and frequent customers.
Even the bottom line is growing again. There had been progress growth in the first quarter, and CEO Brian Niccol explained that after righting the business and getting sales back up, profitability would follow. That's already happening, and earnings per share were up 32% over last year in the quarter.
On top of a chance for a rebound, Starbucks stock pays a growing dividend that yields 2.3% at the current price. However, it trades at a P/E ratio of 81, which prices much of the recovery already into the stock.
The case for Dutch Bros: High growth potential
Dutch Bros is a tiny business compared to Starbucks. It has just over 1,000 stores, with $1.8 billion in trailing 12-month sales and $118 million in trailing 12-month income. It's easy to tell right away that Dutch Bros makes much more net income per store than Starbucks right now.
Dutch Bros is in high-growth mode, opening stores at a fast clip and generating high revenue increases. Revenue was up 31% year over year in the 2026 first quarter, and it makes sense that a smaller company would have an easier time growing its smaller base.
But revenue growth is not a given for any company, and it indicates that Dutch Bros has found a formula that works for its target consumer. It's highly innovative in its beverage creation, and its stores, which are mostly drive-thru-only, are small and fast. Comps were up 8.2% in the quarter.
Dutch Bros management sees an opportunity to reach 7,000 stores over time, which gives the company a long growth runway from where it is today, even though it will remain a much smaller outfit than Starbucks.
Dutch Bros stock trades at a P/E ratio of 80.
Which stock is the better buy?
This contest mostly boils down to which kind of stock you're looking for. Starbucks is the value pick, and Dutch Bros is the growth pick. However, because they trade at similar valuations, I see Dutch Bros having an overall edge.
Should you buy stock in Starbucks right now?
Before you buy stock in Starbucks, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Starbucks wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $469,293!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,381,332!*
Now, it’s worth noting Stock Advisor’s total average return is 993% — a market-crushing outperformance compared to 207% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
*Stock Advisor returns as of May 18, 2026.
Jennifer Saibil has positions in Dutch Bros. The Motley Fool has positions in and recommends Dutch Bros and Starbucks. The Motley Fool has a disclosure policy.
Recommended Articles
Comments (0)
Click the $ button, enter the symbol, and select to link a stock, ETF, or other ticker.