prev

Cartoon of the Day: Grocery Store Robbery

Takeaway: Americans say food prices are getting out of hand.

Cartoon of the Day: Grocery Store Robbery - Food Prices 5.14.2014

LEARN MORE ABOUT HEDGEYE.


VIDEO | Keith's Macro Notebook 5/14: UST 10YR COMMODITIES EUROPE


Video | McCullough on Fox: You Have To Consider Front Running the Fed

Hedgeye CEO Keith McCullough talks markets on Fox Business' Opening Bell with host Sandra Smith, filling in for Maria Bartiromo.

SUBSCRIBE TO HEDGEYE.


get free cartoon of the day!

Start receiving Hedgeye's Cartoon of the Day, an exclusive and humourous take on the market and the economy, delivered every morning to your inbox

By joining our email marketing list you agree to receive marketing emails from Hedgeye. You may unsubscribe at any time by clicking the unsubscribe link in one of the emails.

BLMN: Closing Best Idea Short

We added Bloomin’ Brands (BLMN) to our Best Ideas list on 11/27/2013 at $26.71/share.  Since this time, 2014 EPS estimates have been revised down from $1.33 to $1.22 and the share price has acted accordingly (down ~20%).  With this note we are removing Short BLMN from our Best Ideas list.

 

In our view, Bloomin’ still has issues but we feel our short thesis is largely played out.  At 8.02x EV/EBITDA (NTM) and 16.66 P/EPS (NTM), Bloomin’ screens rather attractively relative to other casual dining companies.  With that being said, we continue to believe casual companies in general are quite expensive.

 

Considering an attractive relative valuation and reset expectations, we believe the short setup is no longer favorable from a risk/reward perspective.  Decelerating two-year same-store-sales trends and stagnant margins continue to give us cause for concern, but staying short at these levels is no longer compelling. 

 

Despite our move to the sidelines, we continue to believe 2015 estimates for 19% EPS growth on 7% revenue growth are too aggressive.

 

Research Recap:

New Best Idea: Short Bloomin’ Brands (11/27/2013)

BLMN: A Bloomin’ Mess (01/13/2014)

BLMN: Beat & Guide Down (02/25/2014)

BLMN: Still Bearish (05/09/2014)

 

BLMN: Closing Best Idea Short - 1

 

Howard Penney

Managing Director

 

Fred Masotta

Analyst


Video | McCullough on Fox: You Don't Ask Wall Street What They Think of Gold

Hedgeye CEO Keith McCullough shares his thoughts on investing in gold with host Sandra Smith, filling in for Maria Bartiromo, on Fox Business' Opening Bell.

SUBSCRIBE TO HEDGEYE.


Video | McCullough on Fox: Fed Has No Idea How to Control Inflation

Hedgeye CEO Keith McCullough weighs in on inflation during Fox Business' Opening Bell.

SUBSCRIBE TO HEDGEYE.


real-time alerts

real edge in real-time

This indispensable trading tool is based on a risk management signaling process Hedgeye CEO Keith McCullough developed during his years as a hedge fund manager and continues to refine. Nearly every trading day, you’ll receive Keith’s latest signals - buy, sell, short or cover.

next