A New BJ's Restaurant in California - Analyst Blog
June 13 2011 - 9:30AM
Zacks
BJ’s Restaurants
Inc. (BJRI) recently announced the opening of a new unit
in Westfield Century City Mall, California. This is the fourth of
the company’s targeted 12 to 13 new openings for fiscal 2011.
The newly opened restaurant spreads
across approximately 7,300 square feet and accommodates around 245
guests. It is located in the 880,000 square feet open-air Westfield
Century City Mall and is expected to benefit immensely from its
strategic positioning. We also expect the great variety of menu
offered at the new unit that includes BJ’s signature deep-dish
pizzas, hand-crafted beers and the much coveted Pizookie dessert to
attract guests.
Some other restaurants with units
in Westfield Century City Mall are Subway, Ummba Grill, Houston's,
Fuddruckers and Gulfstream Restaurant.
The core Californian market, which
was badly hit during the housing downturn, has begun to turn
around. The gradual improvement in this market, which is one of the
major operational locations for the company, should be a key driver
of growth.
Looking forward to 2012 and 2013,
the company plans a low double-digit capacity increase per year in
the approximate range of 12% to 13%. The openings will be equally
distributed in the company’s home turf California, the other
western states and in Florida or some new markets. Around 50% of
the new stores will be conversions of old retail locations.
Despite more business from the new
units, BJ’s Restaurantswill face stiff competition in California
from Red Robin Gourmet Burgers Inc. (RRGB),
Jack in the Box Inc. (JACK), Sizzler and Shakey's
Pizza which have strong presence in that area. Among these, Red
Robin is set to open a new restaurant in Vacaville, California on
June 20. So far, Red Robin has more than more than 70 locations in
California while BJ’s Restaurants has 53.
We maintain a Zacks #1 Rank on
BJ’s, which translates into a short-term Strong Buy rating. Our
long-term recommendation also remains Outperform.
BJ'S RESTAURANT (BJRI): Free Stock Analysis Report
JACK IN THE BOX (JACK): Free Stock Analysis Report
RED ROBIN GOURM (RRGB): Free Stock Analysis Report
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