Posts by Chris Nichols
- Chris Nichols at Yahoo Finance16 hrs ago
Sometimes, when you predict earnings growth of "only" 30%, your stock gets taken apart.
That was the case for Buffalo Wild Wings (BWLD), whose shares were slumping 14.2% to $143.43 Wednesday, its fourth-worst decline ever, a day after it suggested full-year profits might not meet Wall Street's expectations. The last time the stock fell further in a single session was in April 2010, when it had a drop of 17.1%.
Considering Buffalo Wild Wings' past, traders aren't inclined to be patient, even if it speaks to the absurdity of the market. Buffalo Wild Wings is a company that's building new locations, increasing earnings and expanding same-store sales at one of the best rates in the restaurant industry -- it's getting a great deal right. Only today, it happens to be its own main enemy.
- Chris Nichols at Yahoo Finance1 day ago
El Pollo Loco (LOCO) shares were finally taking a break Tuesday after a smashing two-day surge, but that early advance made it clear Wall Street views this company as a potential standout in the increasingly crowded American restaurant scene.
Though there's merit in that, there's also considerable potential that the stock's rapid rise has already gone too far. Not only does the U.S. have 1 million restaurants, but El Pollo Loco, a grilled-chicken chain based in Costa Mesa, Calif., has to go against a multitude of Mexican-themed stores and chicken sellers.
After pricing its IPO last week at $15, El Pollo Loco opened Friday at $19 and went as high as $24.40. On Monday it was more of the same, with shares trading as high as $34.73. Recently, though, it was down 9.1%, at $31.35. Yet even that supports the point on the outlook among traders. The stock fell as low as $29.05, and within an hour it had reclaimed $2 of the decline.
- Chris Nichols at Yahoo Finance5 days ago
Wendy's (WEN) is taking another step toward trying to stand out from the fast-food burger pack, this time by testing an option that allows patrons to create their own sandwich from the ground up.
According to a report in QSR, a publication that closely tracks chain restaurants, Wendy's is conducting the tests at two Columbus, Ohio, stores. Customers can choose beef or chicken, the type of bun -- or no bun -- and various cheeses, sauces and other toppings, the report said.
- Chris Nichols at Yahoo Finance6 days ago
Dunkin' Brands (DNKN) was having one of the worst trading days since its July 2011 IPO, at one point falling to a 52-week low, after disappointing investors with unimpressive revenue and a diminished full-year forecast.
In recent trading, the stock was down 4.3% to $42.09. It's only had four sessions in which it fell more.
For the second quarter, earnings of 47 cents a share met analysts' estimates, but revenue, though up 4.6% from the same period a year ago to $190.9 million, was below the $197.5 million consensus forecast on FactSet. Franchisees, who account for nearly the entire Dunkin' system, reported sales of $2.5 billion, a 5.8% increase from last year.
Dunkin', which owns both the Dunkin' Donuts and Baskin-Robbins brands, said Dunkin' Donuts U.S. same-store sales rose 1.8%, though Wall Street was looking for a 3.7% advance, according to FactSet. Dunkin' Donuts' American locations account for about 70% of Dunkin' Brands system revenue.
- Chris Nichols at Yahoo Finance7 days ago
For McDonald's (MCD), something important has been lost -- the ability to grow in an era when diners are looking for food variety at a fair price.
When considering the Oak Brook, Ill.-based burger seller, it's necessary to avoid suggesting end times are at hand. The chain has almost $90 billion in system sales, which makes it the world's largest food brand by that measure, and an annual corporate profit above $5 billion, with more than 35,000 stores globally. But the Golden Arches have gotten to a growth plateau, maybe even a peak, and investors have to accept that. Traffic, though massive at what executives say is 70 million customers a day, has stagnated. And growth for any business, especially a publicly traded one, is key to its success.
Nothing indicates McDonald's current problems will change anytime soon, not with the latest quarterly report released Tuesday, which merely highlights a trend that's traceable back at least two years. What it shows is that, while McDonald's remains the biggest name in the restaurant group, fast food or otherwise, it's wobbling.
- Chris Nichols at Yahoo Finance12 days ago
When you're McDonald's (MCD), the challenges never really cease.
Some are potentially big, such as changing demands for food and worries about the detrimental health effects of too many burgers and fries. Others are potentially smaller, like saving a few seconds on order times. But taken together, they all mean constant stress for the Oak Brook, Ill., Big Mac chain.
This week another one was called out, and its name is Chick-fil-A. According to a well-known restaurant analyst, the Atlanta-based chicken-and-waffle-fries seller is poised to expand its sales so fast it may take a significant share of the growth that might otherwise have gone to McDonald's (the much larger of the two) in the years ahead.
- Chris Nichols at Yahoo Finance14 days ago
Yum Brands (YUM), the third-biggest U.S.-based restaurant by market capitalization, got earnings season for the nation's largest restaurant chains started in a rather muted fashion.
The owner of Taco Bell, Pizza Hut and KFC earned 73 cents a share for the quarter, in line with the current FactSet expectation, but a penny better than where estimates stood a few days ago. Revenue, however, was $3.20 billion, slightly short of the $3.23 billion consensus. While that's hardly a major miss, it's not much to cheer, either. Its shares, which reached an all-time high this week, fell 2% in after-hours trading Wednesday, following the report.
China, where Yum's results were hurt last year by worries about Avian flu, continued to recover, with system sales increasing 21% for the division. Yum also repeated its earlier projections that full-year earnings per share for the entire company would rise at least 20%. For Taco Bell and KFC, same-store sales rose 2%. At Pizza Hut, they were down 3%.
- Chris Nichols at Yahoo Finance15 days ago
The restaurant stocks that trounced the market last year are continuing to struggle halfway through 2014 as the food frenzy, unstoppable mere months ago, has slowed both on menus and in investor portfolios. And more weakness may be looming if upcoming profit reports don't impress investors.
As of July 14, a group of 42 restaurants surveyed by Yahoo Finance had a loss of 2.8% since the close of trading Dec. 31. That's nearly identical to the end of the first quarter, when the decline for the same stocks was 2.6%. What has changed is the market overall, and how much it's left these stocks behind. Through the first quarter, the S&P 500 was up 1.6%, but that's now risen to a gain of 6.5% year to date, giving the index a 9.3-percentage point lead over the group. In March, it had a 4.2-point advantage.
- Chris Nichols at Yahoo Finance20 days ago
For shares of Potbelly (PBPB), the steep downward trend that's been the hallmark of its brief time as a public corporation got even worse on Thursday, as the Chicago-based sandwich shop had the worst decline since its IPO.
In recent trading, the stock was sinking 24.1% to $11.12 after it told investors second-quarter revenue and earnings would miss expectations, with a shortfall in same-store sales getting the blame. That continues a horrid time for the shares, which started trading last October and reached a high of $33.90. Since then, it's been almost entirely down, and it's now beneath the initial public offering price of $14. Even before the latest slide, the stock was already 57% below its peak. Now, it's 67% from its best level.
- Chris Nichols at Yahoo Finance21 days ago
With Darden Restaurants' (DRI) announcement that a remodel for its Olive Garden division has started, the main takeaway is a simple one — it's nowhere near to giving up on the Italian-themed chain. The other takeaway is that this latest attempt to spur customers to take a seat at its tables may well mean activist investors, who've been vocally at odds with management, received another reason to complain.
Olive Garden has been struggling badly to retain guests, an issue weighing down numerous casual-dining operators who've seen customers opting for fast-casual names such as Chipotle (CMG). To try and reverse that, Olive Garden has been seeking buzz. It's been given a logo makeover, and it introduced new menu items to join its standard fettuccine and breadsticks fare, including an olive and cheese small plate, salmon with bruschetta, crab-topped chicken and a burger.