Dutch Bros (BROS -0.99%) made some incredible progress in the first quarter. If you've been looking for a great growth stock to add to your portfolio or have been concerned about Dutch Bros' performance, let me walk you through three reasons it looks like an excellent stock to buy right now.

1. Massive expansion opportunities

Dutch Bros runs a coffee shop chain, and it had 876 locations in 17 U.S. states as of March 31. The company opened 45 stores last quarter and plans to open 150 to 165 total this year. That includes a gradual eastward expansion into new states.

Its drive-thru-focused concept and products have proven popular in existing markets, and management sees the opportunity to reach 4,000 stores long term, a huge growth driver on its own.

In the first quarter, sales increased 39% year over year, and management raised its full-year outlook slightly to a range of $1.200 billion to $1.215 billion. Adjusted earnings before interest, taxes, deprecation, and amortization (EBITDA) guidance also increased from $190 million to $200 million (both figures at the midpoint of their respective ranges).

2. Popular products will drive future growth

Since revenue growth is expected with new store openings, investors should be closely watching Dutch Bros' same-shop sales, or comparable sales (comps). The company has grappled with inconsistent comps growth over the past two to three years. It was even negative for several quarters between 2022 and 2023.

Management has attributed this comps weakness to its fortressing strategy, which has the company open up a blitz of new stores in one area to establish the brand. That can weigh on comps growth in the near term with the long-term result of a strong brand presence and higher comps.

Same-shop sales growth is important because its underlying components -- customer traffic and ticket size -- give investors insight into how well Dutch Bros is retaining its customers and increasing their spending. It's also important for profitability because higher sales per store means fixed costs are going further.

Comps made a huge comeback in the first quarter to reach 10%. This marked the fourth consecutive quarter of accelerating same-shop sales growth, though management is still guiding for low-single-digit growth for the full year.

3. Scale is leading to profitability

Young companies typically need to invest heavily to grow their businesses, and it's important to see that initial high-investment, high-growth phase eventually evolve into a profitable one. Dutch Bros' adjusted EBITDA increased 120% in the first quarter to $52.5 million. Net income also surged from a $9.4 million loss a year ago to $16.2 million. The company is still posting occasional quarterly losses, but it's moving toward sustainable profits.

Taken together, Dutch Bros is delivering in the three core areas that should be most important to a growth investor.

But that doesn't mean there's no risk. Not all geographic expansions are successful, especially in the ultra-competitive restaurant industry. Management also cautioned this was a strong start to the year, but the business may experience pressure in the coming quarters due to tough year-over-year comparisons and rising expenses.

However, the opportunities still look much more compelling than the risks. Growth is never linear, and long-term investors will see overall trends instead of focusing on short-term volatility. Dutch Bros stock jumped on the first-quarter report, and it could just as likely drop if the next earnings report falls short of expectations. But its outlook remains promising, and if you buy now and hold for years, not months, you'll likely thank yourself later.