THE HBM: DNKN, MCD, CMG, YUM, WEN, SBUX, GMCR, BWLD, PFCB, CAKE

THE HEDGEYE BREAKFAST MONITOR

MACRO NOTES

Comments from CEO Keith McCullough

Raging European bears are begging for bad news and they just aren’t getting it 4 days into the year, yet…

  1. ASIA – after 2 solid up days to start 2012, the 3rd was not a charm – China down -1.4%, HK -0.8%, and India -0.5% reminds us that Equity market bottoms are processes, not points. December data implies growth slowing at a slower rate in Asia (but it’s still slowing).
  2. GERMANY – shaping up on the long side after really impressive employment data this wk (6.8% unemployment rate for DEC amidst the mayhem) and a better than bad Services PMI this morn (52.4 DEC vs 52,7 NOV). German 10yr bond auction was solid too.
  3. 10YR – really bullish for German Bunds to see 4.06B of 10yr paper printed 4bps below 10yr UST’s (1.93% on Bunds vs 1.97% on USTs). I’m watching 10yr UST’s like a hawk for a confirmation that Growth’s Bottom (2011 Slowdown) is in. I’d need to see a sustained breakout > 2.03% to sell my TLT and keep ramping up Global and US Equity exposure (moved to 12% Global Equities yest).

Don’t be perma-anything but permanently managing real-time risk.

KM

SUBSECTOR PERFORMANCE

THE HBM: DNKN, MCD, CMG, YUM, WEN, SBUX, GMCR, BWLD, PFCB, CAKE - subsector fbr

 

QUICK SERVICE

DNKN: Dunkin’ Brands today announced that it signed a “long-term agreement” with National DCP LLS to be the exclusive procurement and distributor of its products to help with its rapid expansion.  National DCP is a Dunkin’ Donuts franchisee-owned cooperative.

DNKN: Dunkin’ Brands raised to Neutral versus Sell at Goldman.

CMG: Chipotle Mexican Grill was added to the Conviction Buy List at Goldman. The PT is $400.

YUM, WEN: Yum! Brands and Wendy’s are not well-positioned in 2012, according to Goldman. Both stocks are rated Sell.

MCD: McDonald’s has launched a geotargeted promotion that uses mobile ads to reach potential customers in an effort to boost McCafe beverage sales and in-store traffic.

SBUX: Starbucks has named Ian Cranna as its new UK marketing chief following the promotion of Brian Waring, who previously held the post, to an international role.

GMCR: Green Mountain was reiterated “Buy” at Canaccord Genuity with a PR of $94.

CASUAL DINING

BWLD: Buffalo Wild Wings was down yesterday as a note from Oppenheimer suggested elevated earnings risk in 2012.

PFCB: P.F. Chang’s was upgraded to “Buy” at Miller Tabek & Co.  The twelve-month price target is $38.

CAKE: The Cheesecake Factory is a Sell in 2012, according to Goldman.

THE HBM: DNKN, MCD, CMG, YUM, WEN, SBUX, GMCR, BWLD, PFCB, CAKE - stocks

Howard Penney

Managing Director

Rory Green

Analyst