TALES OF THE TAPE: DPZ, WEN, PZZA, MCD, COSI

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

  • DPZ reported EPS ex-items of $0.40 cents versus the street at $0.40.   Domestic, company-operated comparable restaurant sales came in at 5.4%, implying a sequential slowdown in two-year average quarterly trends of 175 basis points.
  • WEN’s for-sale concept, Arby’s, has introduced an Angus beef sandwich, the first in what the chain expects to be in a line of premium offerings.  I maintain my positive outlook on WEN, and view the sale of Arby’s as a positive move for the company.
  • PZZA announced that David Flanery is retiring as CEO and Lance Tucker will take over following a transitional period.  The stock traded up 60 basis points on strong volume yesterday.
  • An article on CNNmoney.com published yesterday discussed the increase in weatlhy consumers frequenting low-cost, fast food restaurants.
  • An article on the New York Times’ online “opinionator” blog shed some light on MCD’s oatmeal and the ingredients therein.  According to the article, “Incredibly, the McDonald’s product contains more sugar than a Snickers bar and only 10 fewer calories than a McDonald’s cheeseburger or Egg McMuffin.”
  • COSI outperformed the space yesterday, gaining 2.1% on the day.  I believe this stock price will gain further in the coming months.
  • In general, yesterday, restaurant stocks traded very thinly with volume down across the board.

TALES OF THE TAPE: DPZ, WEN, PZZA, MCD, COSI - stocks 31

Howard Penney

Managing Director