When you want coffee and a quick breakfast your choices include buy-rated Burger King
Only a few exits on I-95 have buy rated Starbucks
There are three buy rated sit down restaurants for breakfast, lunch or dinner, Bob Evans
On our overnight stops we consider dining at one of these three buy-rated restaurant chains. Our favorite is Darden Restaurants'
At any pit stop for gasoline along the way north or back south you can munch on a donut from buy rated Krispy Kreme
This morning the U.S. stock market remains under a ValuEngine valuation warning with 68.6% of all stocks overvalued, 31.3% overvalued by 20% or more. We still show that 15 of 16 sectors are overvalued, 12 by double-digit percentages including today's featured retail-wholesale sector, which is overvalued by 21.5%. The food and restaurant industry 30.6% overvalued.
Now that you know where and what to eat on a trip along I 95, it's time to pull over and check out my recipe for how to buy-and-trade these buy-rated stocks.
Among the ten buy rated food and restaurant stocks in today's table, only one Krispy Kreme is undervalued. Eight stocks gained by 10.9% to 182.2% over the last 12 months with only Darden slipping fractionally. The projected gains over the next 12 months range from 5.6% to 9.0%. The 12-month trailing price-to-earnings ratios appear elevated between 15.8 to 34.0. Only Darden is trading below its 200-day simple moving average.
Reading the Table
OV/UN Valued: Stocks with a red number are undervalued by this percentage. Those with a black number are overvalued by that percentage according to ValuEngine.
VE Rating: A "1-engine" rating is a strong sell, a "2-engine" rating is a sell, a "3-engine" rating is a hold, a "4-engine" rating is a buy and a "5-engine" rating is a strong buy.
Last 12-Month Return (%): Stocks with a red number declined by that percentage over the last 12 months. Stocks with a black number increased by that percentage.
Forecast 1-Year Return: Stocks with a red number are projected to decline by that percentage over the next 12 months. Stocks with a black number in the table are projected to move higher by that percentage over the next 12 months.
Value Level: Price at which to enter a GTC limit order to buy on weakness. The letters mean; W-weekly, M-monthly, Q-quarterly, S-semiannual and A-annual.
Pivot: A level between a value level and risky level that should be a magnet during the time frame noted.
Risky Level: Price at which to enter a GTC limit order to sell on strength.
Here are the buy-and-trade parameters for the buy-rated food and restaurants along I 95:
Burger King ($19.79) set a 52-week high at $21.73 on June 17 and a monthly risky level at $21.29.
Bob Evans ($46.51) set a 52-week high at $48.47 on June 7. My quarterly value level is $42.85 with a semiannual risky level at $47.21.
Cracker Barrel ($93.28) set a 52-week high at $100.01 on June 10. My semiannual value level is $81.25 with a weekly risky level at $98.10.
Denny's ($5.47) set a multi-year high at $6.24 on June 10 then tested its 200-day SMA at $5.31 on June 24. My semiannual pivot is $5.20 with a weekly risky level at $5.93.
Darden Restaurants ($49.55) set a 2013 high at $55.25 on June 10. My monthly value level is $44.31 with an annual pivot at $50.52 and annual risky level at $53.36.
Brinker ($38.63) set a multi-year high at $41.88 on May 22. My semiannual value level is $36.65 with a monthly risky level at $41.69.
Krispy Kreme ($17.89) set a multi-year high at $18.69 on June 7. My weekly value level is $16.34 with a monthly pivot at $17.59.
McDonald's ($98.84) set a multi-year high at $103.70 on April 12. My semiannual value level is $96.07 with an annual pivot at $99.38 and annual risky level at $104.63.
Starbucks ($65.80) set a multi-year high at $67.48 on June 19. My quarterly value level is $63.10 with a semiannual pivot at $65.98 and weekly risky level at $67.91.
YUM! Brands ($69.22) set its 2013 high at $73.89 on June 10. My semiannual value level is $61.13 with a monthly pivot at $69.12 and semiannual risky level at $72.47.
At the time of publication the author held no positions in any of the stocks mentioned.
This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.
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- Consumer Discretionary
- Krispy Kreme
- Darden Restaurants
- Burger King