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Monday Mashup - CHART 1

RECENT NOTES

8/28/15 ZOES | Entering the Big Leagues

8/24/15 SBUX | DO THE NEW FOOD OFFERINGS DRIVE INCREMENTAL TRAFFIC?

8/17/15 MCD | Create Your Taste Experience

8/11/15 SHAK | PLANTING FLAGS

RECENT NEWS FLOW

Friday, August 28

ZOES | Entering the Denver market full force, three leases signed for restaurants to be completed next year (click here for article)

 

Thursday, August 27

MCD | Dropped chicken supplier after investigation uncovers mistreatment of animals (click here for article)

Wednesday, August 26

QSR | Burger King reached out to MCD to join forces for a good cause, MCD declined to participate (click here for article)

 

Tuesday, August 25

MCD | Real-estate drama is always surrounding the company, we continue to believe it is not right for the company (click here for article)

BJRI | BJ’s Restaurants opens new location in Little Rock, Arkansas (click here for article)

Smashburger | Goes Better-For-You with new grilled chicken strips and other options for their Kids Meal menu (click here for article)

KKD | To open 10 shops in Myanmar over the next five years (click here for article)

CAKE | Opens new location in Austin, Texas (click here for article)

Monday, August 24

CMG | To hire 4,000 people in a single day on September 9th (click here for article)

NDLS | Appointed Dave Boennighausen to the Board of Directors (click here for article)

FRS | Frisch’s Restaurants approved the merger transaction with NRD Partners, will be formally delisted on September 4, 2015 (click here for article)

DFRG | Opened new Grille location in Stamford, CT (click here for article)

SECTOR PERFORMANCE

Casual dining stock widely underperformed the XLY while quick service stocks outperformed it last week. The XLY was up +1.6%, top performers from casual dining were CAKE and BWLD posting an increase of +1.3% and +0.8%, respectively, while ARCO and GMCR led the quick service group again this week up +7.6% and +6.3%, respectively.

Monday Mashup - CHART 2

Monday Mashup - CHART 3

QUANTITATIVE SETUP

From a quantitative perspective, the XLY looks bearish from a TRADE and TREND perspective, TRADE support is 69.82.

Monday Mashup - CHART 4

CASUAL DINING RESTAURANTS

Monday Mashup - CHART 5

Monday Mashup - CHART 6

QUICK SERVICE RESTAURANTS

Monday Mashup - CHART 7

Monday Mashup - CHART 8

 

Keith’s Three Morning Bullets

  1. FEDERAL RESERVE – Fischer opted for dovish comments on Friday, making his Saturday comments more hawkish – I guess they look at the S&P Futures now before saying anything of consequence (today he’d be dovish); Fed Fund futures have ramped back up to 38% on a SEP hike probability – reminder: the Fed has never hiked into a slowdown
  2. COMMODITIES – dovish = commodity reflation; hawkish = commodity #Deflation – so the deflation TREND is right back on this morning w/ Oil, Copper, and Russia down -2-3%; WTI’s risk range blew out to $36.99-45.32 on Friday, all but ensuring that massive volatility remains in this asset class
  3. SP500 – still has the widest risk range my model has generated since 2008 at 1 with the more probable level being the downside one (-7.7% from Friday’s close), given that the Fed could be tightening into a 0.1% GDP environment here in Q3 (our low-end scenario with the high end being at 1.5% and the Atlanta Fed tracking 1.2%)

 

 

Please call or e-mail with any questions.

Howard Penney

Managing Director

Shayne Laidlaw

Analyst