Notable news items and price action from the restaurant space, as well as our fundamental view on select names.




Unemployment continues to be a concern as Initial Jobless Claims came in at 428,000, leaving the rolling number at 426,750.  Considering that the level of claims needs to drop to ~375,000 before a reduction in the unemployment rate can come about, this is another reminder of the gravity of the employment situation in the U.S.


Commodity prices are not moving in tandem, as they have – straight up – over much of the past nine months, but there seems to be considerable inflation in many foodstuffs. For instance, rice supply in China, the world’s biggest grower and consumer, may decline after drought and floods damaged crops, potentially boosting inflation and increasing imports. 


Corn rose in Chicago, reducing the decline seen in 2Q, on speculation that the government will reduce its estimate for national acreage and stockpiles of the grain.  Delayed planting, poor weather and flooding may limit crop yield potential, according to some commentators.


For the week ended June 24, gasoline demand dipped 1.8% below year ago levels as pump prices were 32% higher than in 2010, according to Mastercard.  We are short CBRL in the Hedgeye virtual portfolio.




  • DNKN is said to be setting its IPO price range as soon as next week.
  • WEN spoke at the Oppenheimer Consumer Conference and provided guidance for same-store sales of +1 to 3% and food inflation of 5 to 6%.  The stock gained 1.4% on slightly-higher-than-usual volume.
  • CBOU declined 4.6% on accelerating volume.  Over the past month, the stock is by far the best performing in QSR.



  • RUTH declined on accelerating volume.





Howard Penney

Managing Director

Did the US Economy Just “Collapse”? "Worst Personal Spending Since 2009"?

This is a brief note written by Hedgeye U.S. Macro analyst Christian Drake on 4/28 dispelling media reporting that “US GDP collapses to 0.7%, the lowest number in three years with the worst personal spending since 2009.”

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7 Tweets Summing Up What You Need to Know About Today's GDP Report

"There's a tremendous opportunity to educate people in our profession on how GDP is stated and projected," Hedgeye CEO Keith McCullough wrote today. Here's everything you need to know about today's GDP report.

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Cartoon of the Day: Crash Test Bear

In the past six months, U.S. stock indices are up between +12% and +18%.

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GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

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Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

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Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

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Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

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People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

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UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

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Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

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Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

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An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

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