THE HBM: SBUX, MCD, COSI, WEN, BOBE

THE HEDGEYE BREAKFAST MONITOR

MACRO NOTES

University of Michigan Consumer Confidence comes out today at 09:55 a.m.  We’ll be watching for any indication of a further slump in confidence although, at least for the restaurant space, confidence hasn’t seemed to matter lately although it may begin to matter if it slumps much lower.

THE HBM: SBUX, MCD, COSI, WEN, BOBE - umich survey vs actual

 

SUBSECTOR PERFORMANCE

THE HBM: SBUX, MCD, COSI, WEN, BOBE - subsector fbr

QUICK SERVICE

SBUX: Starbucks announced the acquisition of juice company Evolution Fresh for $30 million in cash.  The company hopes that the purchase will help Starbucks gain a foothold in the estimated $50 billion health food market.  We believe that the company's strategy is to capture the upside in profits by owning these small brands in tangent categories.  Starbucks' distribution channel provides a clear runway for these brands to grow rapidly.

SBUX: Starbucks is targeting 20% of customers in Malaysia to use the newly-launched pre-loaded Starbucks card.  A spokesman for the company said that the card is a stored value card that offered customers convenience when purchasing merchandise at any Starbucks store nationwide.

MCD: McDonald’s is looking to capitalize on the depressed commercial property market and purchase more of the land and buildings where it operates, according to management commentary during an investor conference yesterday. 

COSI: Cosi issued a letter to Brad Blum yesterday saying it would welcome his offer to lead the company for $1 if it were “sincere”.

WEN: Wendy’s was maintained “Overweight” at Barclays.

CASUAL DINING

BOBE: Bob Evans Farms was downgraded to Equal Weight from Overweight at Stephens.

THE HBM: SBUX, MCD, COSI, WEN, BOBE - stocks 1111

Howard Penney

Managing Director

Rory Green

Analyst