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Notable news items/price action over the last twenty four hours.

  • JACK reported earnings last night after the close.  EPS came in at $0.61 versus the street at $0.48.  Approximately $0.02 came from a tax benefit. 
  • PZZA gained following its strong results on Tuesday after the close.  Management struck a confident tone on the earnings call yesterday.
  • TXRH held an Analyst/Investor Day in NYC yesterday and outlined aggressive growth and expansion plans.  The company is providing aggressive comp guidance that could be at risk if the company has to take more price than it is currently planning on taking in 2011.
  • SAFM reported weak earnings this morning.  An insightful comment from the press release: “While retail demand for chicken has remained steady, we have continued to see weak food service demand, and we expect this trend will remain until the national unemployment rate improves.  Consumers are simply not dining out as frequently and restaurant traffic has remained under pressure.”
  • TAST reported Q4 EPS of $0.12 versus consensus at $0.19 and announced its intention to split the business into two, separate, publicly traded companies.  Specifically, the company stated in its press release, “The separation of our Hispanic Brand and Burger King restaurant businesses is a natural evolution for Carrols. We believe that the separation will enable each company to better focus on its respective opportunities as well as to pursue its own distinct plan and growth strategy. We also believe that a separation offers the potential for improving shareholder value as each publicly traded company will be better positioned to align its business with its respective shareholders' objectives."
  • RRGB saw one of its holders, Clinton Group, lower its stake to 5.2% from 9.72%.
  • RT, DIN, RRGB, TXRH, and DRI all declined on accelerating volume yesterday. 
  • MRT gained yesterday on strong volume.  The company reports today after the market.
  • DPZ and CMG declined yesterday on accelerating volume.  Both are at risk to commodity exposure.  DPZ is facing a vertical cheese price chart and a difficult 1Q compare versus 1Q2010 and CMG is largely unlocked from a commodity cost perspective.

TALES OF THE TAPE: JACK, PZZA, TXRH, SAFM, TAST, RRGB, RT, DIN, DRI, MRT, DPZ, CMG - stocks 224

Howard Penney

Managing Director