Wed, Oct 1, 2014, 11:47 PM EDT - U.S. Markets closed

Recent

% | $
Quotes you view appear here for quick access.

Frisch's Restaurants, Inc. Message Board

  • swampgator1 swampgator1 Apr 9, 2002 9:05 AM Flag

    Why stock did not fly yesterday

    Management has stopped buying back stock due to the now "high share price." Indicates that management figures stock is pretty much fully valued and internal cash can be better used for expansion.

    High SSS numbers have a big "nice weather" component.

    Management noted that new Golden Corrals will tend to cannibalize sales of nearby stores.

    I still like this company (at under $18 per share).

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • Bob Evans had a March sales increase of 3.5%, including 2.8% price increase. Evans had a 4.3% increase in Feb and 5.2% increase in Jan. Ther is a lot of overlap geographically with FRS. I think one reason FRS is not buying back stock could be they need dollars to fund future Goldern Corrals (cost about $2 per share a year, some of it to be borrowed of course), and maybe some more Big Boys.

      • 1 Reply to algo41
      • One way to think of it is that the return on new stores is better than the return on buying back shares. Until this quarter, this was not the case and management was willing to commit funds to a share buyback and was content to borrow to fund expansion (at a throttled back pace in case of Golden Corral).

        FRS is a rather smallish company and this tends to sit on its PE. Reasonably, one could argue that the stock merits a PE going forward of around 11-12.

        For FY2003, $1.65 is pretty doable.

        12 x 1.65 = 19.95 price target for end of May 2000 seems resonable.

        A price decline to $18 would make a trade worthwhile.

 
FRS
28.23-0.07(-0.25%)Oct 1 4:00 PMEDT

Trending Tickers

i
Trending Tickers features significant U.S. stocks showing the most dramatic increase in user interest in Yahoo Finance in the previous hour over historic norms. The list is limited to those equities which trade at least 100,000 shares on an average day and have a market cap of more than $300 million.