Panera Bread Co. Message Board
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Look out Noodles & Co.!
I think I stumbled into a market test this morning. My regular Panera is now featuring 3 pastas: Penne Rustica, Tortelini Alfredo, and Pesto Sacchettini. I checked the conference call transcript, and the only reference to these I could glean was a mention of "leveraging the soup platform" in answer to a question on daypart growth. The pasta is not on the paper menus, but there is signage for it.
I think this makes sense. When mac & cheese was an experiment, it was commented as one of the highest margin items on the menu. One strange thing about these is that they are a "forced you pick two." They come in a smaller bowl size, and are paired with a cafe salad or soup. This could make sense to help it seem better as a dinner menu item, and not just a side. Still, I would expect that if they survive they fall back into the normal option choices.
Overall, the quality was pretty good. The pesto was not overpowered with garlic. And having the shaved parmesan cheese melt on top was a very good touch.-
so far, during the recession, the company has only gotten stronger, taking more market share while other chains have gone bankrupt. the drop in real estate has enabled them to secure long term leases at favorable rates. their new stores continue to break records in weekly sales. their same store sales have been good throughout the economic decline. their catering business (via panera) continues to expand. their breakfast segment has done well. now if they can get a dinner segment going, this will secure further growth for quite awhile. they can double the bakery/cafes in the united states, and expansion abroad has not occurred yet. the valuation is high now, with prices suggesting a 25% future growth rate. a 20 or 30% drop in the short term is a reasonable possibility. but long term things look good.
- 3 Replies to wrench150
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They are heading down the same path of playing the short squeeze game alongside fast money. They seem to not understand their respective positions are too large sell quickly to realize the high prices, where fast money can not only do that, but buy puts, liquidate and go short. Why do you think the MOMOs have fallen so quickly when they break.
Several long only fund managers have been nothing short of negligent IMHO, failing to aggressively take profits in what everyone recognizes are stocks that are overvalued based upon CURRENT fundamentals (not some prayer for future performance). In so doing, they are permanently damaging their respective brands and likely limited future inflows into their respective funds.
The overlap between PNRA and other migh multiple stocks is lower, so maybe these folks need to make the mistake themselves. But, FMR should get it by now and let the other large holders take the hit... -
You mean so far during the recovery. We've had growth for the past 2 years enabled by stimulus and loose monetary policy. You've seen peak earnings.
Clearly, the institutional longs are going to make the same mistake made in NFLX and GMCR (we might be adding AMZN to that soon...).
I'll be here as long as it takes. This company doesn't have the fundamentals to justify its place. -
We've been growing for 2 years enabled by stimulus that we cannot afford and incredibly accomodative monetary policy. We are hitting the macro wall. Gov't has no money for stimulus and rates cannot go much lower...
Stagflation is coming. NO company will have a 32X multiple, especially a restaurant with a mature concept...
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