Join Hedgeye's Restaurants Team – led by Sector Head Howard Penney – for the presentation of their New Best Idea LONG: Potbelly Corporation (PBPB). The call will take place on Tuesday June 20, at 1 pm ET.
Email firstname.lastname@example.org for more information.
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The live Black Book presentation on Tuesday at 1:00PM ET will run though why they believe PBPB could double over the next couple of years driven by refranchising, refining 4-wall performance, and giving back to shareholders through buybacks and potential dividends in the future.
KEY DISCUSSION POINTS:
- Capital Spending Reset: New CEO, slowing unit growth, implementation of technology and the potential of using the balance sheet/refranchising highlight what PBPB can do to turn this ship around. We have already seen PBPB pull back on unit growth slightly, and have the potential to do more in 2H17.
- On Trend Concept and Coming up the Curve on Technology: The PBPB concept fits where consumers are going in today's mobile environment. We anticipate they can turn around dismal traffic trends through their improved app and "Potbelly Perks" loyalty program.
- Potbelly Should be an Asset-Light Model: The new CEO should implement change and transform PBPB into a predominantly franchise business, in order to free up capital, de-risk the business, and grow with other people's capital. Transforming the business model will allow PBPB to cut G&A and possibly invest more into their food quality and innovation, enabling franchisees to experience greater profitability.
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