Fast food giant Dunkin' Donuts, belonging to Dunkin’ Brands Group, Inc. (DNKN - Free Report) , had announced a partnership with Amtrak Corporation in the first quarter of 2017. Per the agreement, Dunkin’ Donuts’ hot coffee was offered to 3.4 million annual customers on Amtrak’s high-speed train – Acela Express.
The partnership has now been expanded to offer Dunkin' Donuts Original Blend and Dunkin' Decaf hot coffee on Amtrak Northeast Regional trains as well. This will make Dunkin’ Donuts' signature beverage line available to a combined 12 million customers travelling on the trains each year. Dunkin’ Brands enjoys significant customer trust and brand loyalty which makes it easier for Dunkin’ Donuts to launch various innovative product lines.
Notably, growing sales of the company’s Cold Brew coffee has opened up substantial opportunity for Dunkin' Brands in the beverage space. In fact, owing to its relentless focus on strengthening its beverage portfolio, the company launched ready-to-drink bottled iced coffee in February 2017 which was manufactured, distributed, marketed and sold by The Coca-Cola Company (KO - Free Report) nationwide.
In addition to these sales initiatives, Dunkin' Brands is trying to drive revenues through a focused expansion strategy, both domestically and internationally.
However, Dunkin' Brands’ international comps growth has been suffering over the last few years at both the Dunkin’ Donuts and Baskin Robbins divisions. Further, a soft consumer spending environment in the domestic restaurants space along with intense competition from food and beverage companies like Starbucks Corporation (SBUX - Free Report) and McDonald’s Corporation (MCD - Free Report) might impede revenue growth for the company.
Meanwhile, Dunkin' Brands’ shares have underperformed its industry year-to-date. While the stock has gained 1.1%, the industry witnessed a rally of 7.9%.
Nonetheless, the company is expected to sustain its momentum on a solid product pipeline and diligent expansion efforts.
Dunkin' Brands currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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