Dunkin’ Brands Group Inc. may struggle to duplicate the loyalty of its northeastern customers as the doughnuts-and-coffee chain expands across the U.S.
Dunkin’ has “really not been proven west of the Mississippi, but it does have a cult-like following in the Northeast,” said Christopher O’Cull, a Nashville, Tennessee- based analyst at researcher SunTrust Robinson Humphrey. “The question is: can that be replicated?”
Based on expectations that Dunkin’ can take on the likes of Seattle-based Starbucks Corp. and Peet’s Coffee & Tea Inc. nationally, investors have driven up the chain’s shares 44 percent since last month’s initial public offering, compared with a 16 percent drop for the Standard & Poor’s 500 Index.