Is Dutch Bros a Buy After Crashing 19% in 1 Day?

Dutch Bros reported 40% diluted earnings-per-share growth in the second quarter.

The coffee stock has tremendous upside should it continue expanding its store base at a rapid pace.

Shares of Dutch Bros (NYSE: BROS) are taking it on the chin. They tanked 19% on Aug. 6, the day following the company's release of second-quarter financial results (quarter ended June 30).

The market's reaction doesn't seem warranted. The coffee stock posted 32.5% year-over-year revenue growth, with diluted earnings per share (EPS) soaring 40%. And it opened 48 new stores in the quarter.

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I think the stock's latest blip presents investors with a good opportunity to add this business to their portfolios. Dutch Bros has what it takes to be a winning investment in the coming five years.

The company's growth trajectory remains intact. It plans to open 185 net new coffee shops in 2026. And by 2029, the goal is for there to be 2,029 Dutch Bros locations, up from 1,225 today.

It's also worth highlighting how each shop is performing. Even in a highly uncertain macro backdrop, systemwide same-store sales rose 5.8% last quarter, continuing a 19-year streak of positive growth last year.