Famous Dave's Beats by a Penny - Analyst Blog
August 02 2011 - 8:45AM
Zacks
Famous Dave's of America
Inc. (DAVE) recently reported second quarter 2011 adjusted
earnings of 29 cents per share, which beat the Zacks Consensus
Estimate by a penny and came in line with the prior-year
earnings.
Minnetonka, Minnesota-based Famous
Dave’s, which owns, franchises and operates restaurants in the
U.S., reported total revenue of $41.3 million, up 1.5% year over
year. Same-store sales for company-owned restaurants were down 1.2%
during the quarter compared with an increase of 0.6% in the
year-ago quarter. Same-store sales from franchise-operated
restaurants declined 1.4% versus a 0.6% decline in the second
quarter 2010.
During the quarter, company-owned
restaurants sales inched up 0.8% to $36.5 million, despite a price
increase of 2.0%. Franchise royalty revenue upped 4.0% year over
year to $4.4 million, reflecting the opening of two new
franchise-operated restaurants.
Operating income decreased 4.9% to
$3.9 million in the reported quarter, due to a significant rise in
total expenses.
Store Update
At the end of the second quarter,
the company’s portfolio boasted of 181 restaurants, including 52
company-owned restaurants and 129 franchise-operated
restaurants.
Financial
Position
Famous Dave's ended the quarter
with cash and cash equivalents of $2.3 million and shareholders’
equity of $34.6 million.
Outlook
For fiscal 2011, the company
expects two company-owned restaurant and approximately eight
franchise-operated restaurant openings.
Our Take
As the economy is showing signs of
improvement, we believe Famous Dave's will be able to generate
improved earnings. However, estimates have not budged in the last
30 days, indicating the absence of any near-term catalyst.
One of Famous Dave's primary
competitors, Buffalo Wild Wings Inc.’s (BWLD)
second quarter 2011 earnings of 58 cents per share missed the Zacks
Consensus Estimate of 60 cents.
Famous Dave's currently retains a
Zacks #4 Rank, which implies a short-term Sell rating on the stock.
We reiterate our long-term Neutral recommendation.
BUFFALO WLD WNG (BWLD): Free Stock Analysis Report
FAMOUS DAVES (DAVE): Free Stock Analysis Report
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