Getting Ready for Earnings From 2 Holdings After the Market Close
Here are the market’s expectations and what we’ll be looking for.
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Coming up after the close we have quarterly results from Dutch Bros BROS and The Trade Desk TTD. Let’s set the stage with market expectations for those reports and share what we’ll be focusing on as we review them.
Dutch Bros
The growing coffee shop company is expected to report EPS of $0.02 on revenue of $318.78 million and guide its March quarter to EPS of around $0.10 on $331.5 million in revenue. We continue to favor the geographic expansion story, a time-tested strategy in food and beverage companies like Dutch Bros. We’ll be looking for more insight into the company’s food testing and more concrete timing for that roll-out. We will also be interested in an update on its expansion plans, but we could see the company holding back, laying the groundwork for its March 27 Investor Day.
The recent retrenchment in BROS shares means they are no longer overbought, but as of now, they are hovering around our current price target. Based on what we learn tonight we will address that target, but unless we can see upside to $76 or higher, we’re inclined to keep our Two rating intact.
At the same time, we recognize expectations going into today’s call, given the move in BROS share over the last few months, are likely to be high. What this means is barring a meaningful beat-and-raise quarter relative to consensus expectations, we could see BROS shares pull back in response. Should that happen, subject to where the shares settle out, that could be an opportunity.
The Trade Desk
Turning to The Trade Desk, the market expects EPS of $0.57 on revenue of $759.5 million for the December quarter and EPS of $0.31 to $582.7 million for the current one. While we continue to see Trade Desk benefiting from the ongoing shift to digital advertising and the adoption of advertising revenue models at streaming platforms and other companies, like DoorDash DASH and Uber UBER, we recognize the December quarter benefited from 2024 presidential campaign spending.
On the earning call, we would expect Trade Desk management to detail that impact on the December quarter and for all of 2024. It will also need to provide a roadmap to match or exceed 2025 EPS expectations of $1.96 vs. the $1.64 consensus for 2024. With the accelerating shift toward digital advertising making for a very nice tailwind, a post-earnings pullback to the 200-day moving average near $109 could make for a nice pickup point. We’ll have a better sense once we’ve digested the report and management’s comments.
At the time of publication, TheStreet Pro Portfolio was long BROS and TTD.
