TALES OF THE TAPE: CMG, SONC, PZZA, CBOU, PEET, SBUX, DRI, RUTH, BJRI, BWLD

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

MACRO

The main commodity data points this morning are wheat and coffee prices declining.  Warmer weather may aid wheat spring prospects and easing fears about frost damage in Brazil is causing coffee prices to decline.

French newspaper Le Figaro is claiming that French lawmaker Bernard Reynes is proposing an increase in the value-added tax on soft drinks from 5.5% to 19.6% to help finance assistance to agriculture.

QUICK SERVICE

  • CMG, it emerged yesterday, invested $2.5m in Soul Daddy, the winner of the America’s Next Great Restaurant television show.  $2.5m is equivalent to $0.08 per share for CMG.
  • SONC has introduced a line of sundae shakes and a new spicy hot dog option.
  • PZZA was cut to “Neutral” at SunTrust Robinson.  The stock closed down -4.7% on accelerating volume yesterday.
  • CBOU, PEET and SBUX all gained on accelerating volume as coffee prices came down.

 

CASUAL DINING

  • DRI was raised to “Strong Buy” at Raymond James.  The PT is $62.
  • RUTH, BJRI, and BWLD gained on accelerating volume.

TALES OF THE TAPE: CMG, SONC, PZZA, CBOU, PEET, SBUX, DRI, RUTH, BJRI, BWLD - STOCKS 76

Howard Penney

Managing Director

Rory Green

Analyst