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Panera Bread Company Message Board

  • only_observing only_observing Dec 9, 2008 8:13 AM Flag

    PNRA has beaten S&P500 by 60%+ this year


    SSS are expected to be up less than 2% this quarter and that's much lower than McDonalds.

    The Paneras I check are doing so-so (info gleaned from managers).

    How long can this continue?

    What's the secret here?

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    • what are the estimates/

    • Its called aggressive accounting . Google it .

    • 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.

215.54+5.59(+2.66%)Jul 22 4:00 PMEDT