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Lately we have been seeing some good opportunities on the short side but PFCB remains one of our favorite longs.  Keith bought PFCB today in the Hedgeye Virtual Portfolio.

P.F. Chang’s is a turnaround story that is, we believe, slowly turning the tide of bearishness that has weighed down the stock during the last few years.  We are confident that the company – for the first time in a while – has a credible plan to turn the Bistro around.  The stock languishes near the bottom of our sentiment scorecard so there are still plenty of analysts and investors to be converted.

In terms of catalysts, April 2nd is an important day for the Bistro as the Triple Dragon initiative is launched.  The initiative blends “a number of the key initiatives including our new lunch menu, some of the best items from our innovation Bistro menu; new music and a new look for our service teams.  All of these are designed to elevate our guest experience and energize our employee team”. 

As the chart below shows, the stock is nearing the trade-line support line at $39.35.

PFCB: TRADE UPDATE - pfcb levels

Howard Penney

Managing Director

Rory Green

Analyst