2008 EPS consensus: 2.22 2009 EPS consensus 2.60 PE on 2009 estimate at 51: 19.6 PEG on above: 1.15. Growth rate: about 17%.
both EPS numbers have been stable since earnings.
strong recent presentation indicating no weakness.
new additions to breakfast coming
great benefits from reduced energy costs (both for Pnra and its customers) and other commodities.
Bottom line: if you believe the earnings estimates, the stock is not cheap historically or nominally.
McD is a great company and is executing amazingly well. But being a mature concept, the growth rate is low. Thus, 3.83 for '09 vs. 3.62 for '08 is less than a 6% growth rate. Compared to Pnra's PE on '09 of 19.6, McD's is 15.9 but growing only 1/3 as much as Pnra. Neither company is particularly expensive nor dirt cheap. Covered call premiums for Pnra are very high and it is what I am doing. I'm currently split between Feb 50 calls and Jan '10 60 calls and will roll out higher on the 50s when appropriate.
If you don't believe the estimates are substantially correct, obviously it's a different matter. I do believe them. Pnra does particularly well in a bad economy as casual dining trades down, rents on new stores get cheaper, commodities get cheaper and prices don't have to be lowered after having been raised.