Coffee & Cushioned Soles: Two Stocks I’m Nursing

My aunt Carol, a woman who believes diversification means having three shades of beige in her wardrobe, recently cornered me at Thanksgiving. “So,” she said, brandishing a deviled egg, “you pick stocks? Is that like…gambling with charts?” It’s a fair question, honestly. Most of the time, it feels less like shrewd investment and more like trying to predict which way a particularly stubborn pigeon will fly. But occasionally, you stumble across something that feels…different. Something that makes you think, “Okay, maybe this won’t end with me selling my stamp collection.” Right now, two companies are giving me that sliver of hope. They’re not glamorous. They won’t solve world hunger. But they might, just might, provide a decent return. And frankly, at this point, I’ll take anything that isn’t beige.

I’m talking about Dutch Bros (BROS +4.68%) and On Holding (ONON +2.16%). Both have taken a bit of a beating lately, which, as any seasoned investor (or anxious relative) knows, is often when the interesting things happen.

Dutch Bros

Look, I’m not a coffee connoisseur. My preferred method of caffeine delivery involves a gas station brew and a silent apology to my taste buds. But even I can appreciate what Dutch Bros is doing. They’re building a drive-thru empire, one sugary concoction at a time. It’s a simple concept, really. People like coffee, people are lazy, ergo, people will drive for coffee. It’s almost…elegant. They’ve managed to maintain positive same-store sales even when everyone else was tightening their belts and questioning their life choices. That’s a feat. They’ve posted five consecutive quarters of transaction growth, which is frankly astonishing. I’m starting to suspect they’re slipping something extra into the caramel macchiatos.

They’ve got room to grow, too. A lot of room. They’re currently operating in 24 states, which leaves a full 26 for expansion. That’s a lot of drive-thrus. The stock is down 36% from its peak, which, in my book, makes it a perfectly acceptable time to cautiously dip your toes in. It’s trading at a high P/E multiple, sure, but they’re aiming for 7,000 stores eventually. That’s a lot of coffee. And frankly, I’m starting to see the appeal. I might even try a Dutch Bros beverage myself. (Don’t tell my aunt Carol.)

On Holding

Shoes. I generally try not to think about shoes. They’re expensive, they pinch, and they inevitably end up covered in something unpleasant. But On Holding is making me reconsider my stance. Their cushioning technology is, apparently, award-winning. I haven’t personally tested it – I’m more of a “supportive sock” kind of guy – but the sales figures speak for themselves. They’ve seen explosive growth in recent years. And, crucially, they’re gaining traction in Asia-Pacific, where sales surged 94% last quarter. That’s a region you want to be in. It means they’re not just selling shoes to people who enjoy hiking; they’re selling them to, well, a lot of people.

They recently opened a store in Tokyo that generated the highest monthly sales of any store globally. Another one in Bangkok had the highest daily opening sales in company history. I’m starting to suspect they’re giving the shoes away. Or maybe people in Tokyo and Bangkok just really, really like comfortable footwear. The stock is down 31% from its peak, bringing the forward P/E down to a more reasonable 25. That’s a price I can almost justify. Almost. I still think shoes are fundamentally absurd, but I’m starting to see the business case. And if it keeps my aunt Carol from lecturing me about diversification, it’s worth every penny.

So, there you have it. Two stocks, a slightly cynical investor, and a lingering suspicion that I’m probably making a terrible mistake. But hey, at least it’s not beige.

2026-02-15 05:13

Dutch Bros

On Holding

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