Zacks.com Features the Following Top Stocks in the Restaurants Industry: Panera Bread, Applebee's, Ruby Tuesday, McDonald's and Starbucks

Business Wire, August 23, 2004

CHICAGO -- Pull up a chair with the All Stars and dig into five recommendations from the restaurants industry that can satisfy your hunger for profit. Here are some of the top recommendations in the Restaurants industry: Panera Bread Company (NASDAQ:PNRA), Applebee's International, Inc. (NASDAQ:APPB), Ruby Tuesday, Inc. (NYSE:RI), McDonald's Corporation (NYSE:MCD), and Starbucks Corporation (NASDAQ:SBUX). Discover the full story at Zacks.com http://at.zacks.com/?id=96

What Do The All Stars Recommend:

Panera Bread Company (NASDAQ:PNRA) owns and franchises bakery-cafes under the Panera Bread and Saint Louis Bread Company names. Although the company raised a few eyebrows when it adjusted its 2004 earnings per diluted share target downward, the All Stars weren't frightened away as many believe that this growing company's problems are temporary. In fact, with four recommendations, Panera Bread has more All Stars in its corner than any other company in the restaurants industry. Earlier this month, the company reported second quarter earnings of $0.21 per diluted share, which was 11% better than last year's $0.19. It also matched the consensus, and marked the 18th consecutive quarter of earnings per share that either met or topped Wall Street expectations. Looking forward to 2005, Ron Shaich, Chairman and CEO, stated, "We believe as commodity prices stabilize, and the percentage change in new company bakery-cafe openings moderates, earnings will once again expand at a faster rate then revenue." Many analysts believe that as well, and are expecting big things from this unique and growing restaurant company.

Applebee's International, Inc. (NASDAQ:APPB) develops, franchises and operates restaurants under the Applebee's Neighborhood Grill & Bar brand, the largest casual dining concept in the world. Applebee's is a favorite in its industry among analysts, as the company has made many moves over the years to improve its business. Excluding items in both periods, Applebee's reported second quarter earnings of $0.36 per diluted share, vs. $0.30 in the year-ago period. The result was almost 6% better than the consensus. System-wide comparable sales improved 6.3%, marking an impressive 24 straight quarters of comparable sales growth. Applebee's also continues to make its menu more appetizing to its customers, as evidenced by the addition of ten Weight Watchers(R) items in May and the introduction of baby back ribs. During the quarter, twelve new Applebee's restaurants were opened system-wide, bringing the total to 1,612 by the end of the period. Over 100 new restaurants are expected to open this year.

Ruby Tuesday, Inc. (NYSE:RI) has company-owned, and/or franchise Ruby Tuesday brand restaurants in 41 states, the District of Columbia, Puerto Rico, and 12 foreign countries. Ruby Tuesday has put together 28 consecutive quarters of earnings per share at or above Wall Street expectations. That includes its fiscal fourth quarter result from mid-July, when the company reported diluted earnings of $0.46 per share. The result was in-line with the consensus, and 17.9% better than last year's $0.39. "As we head into fiscal 2005, we now plan to invest money in advertising initiatives affecting the majority of our company-owned locations," said Sandy Beall, Chairman and CEO of Ruby Tuesday. "We believe these initiatives, among others, will enable us to continue to deliver on our longer-term goals."

McDonald's Corporation (NYSE:MCD) develops, operates, franchises and services a worldwide system of restaurants that prepare, assemble, package and sell a limited menu of value-priced foods. The company operates primarily in the quick-service hamburger restaurant business. The McDonald's "Plan to Win" strategy continues to pay off for the industry stalwart, as global comparable sales advanced 6.4% in July. That marks the company's 15th straight quarter with a global same-store sales rise. U.S. comparable sales advanced 7.8% in the period, demonstrating the sustainability of its Plan and the staying power of its renewed momentum. In late July, the company reported diluted earnings of $0.47 per share, which matched the consensus and accounted for the 12th straight quarter of earnings per share that matched or surpassed Wall Street's expectations. The result was also up 27% (or 22% in constant currencies) from last year's $0.37. Also, revenues advanced 10% (or 7% in constant currencies) to $4.7 billion in the quarter, as comparable sales improved 7.8%.

Starbucks Corporation (NASDAQ:SBUX) is the leading retailer, roaster and brand of specialty coffee in the world, with more than 8,000 retail locations in North America, Latin America, Europe, the Middle East and the Pacific Rim. Starbucks is the McDonald's of coffee, so it's only fitting that it too enjoys solid momentum. Late last month, the company announced consolidated net revenues of $409 million for July, which was an increase of 27% year-over-year. Furthermore, same-store sales improved 10%. An analyst at WR Hambrecht & Company stated, "We expect the strong comp store sales momentum to continue through the end of the year. We continue to recommend purchases of SBUX shares based upon management's ability to sustain at least 20% sales and earnings growth, continue to rapidly grow the store base, drive international profitability, increase store volumes, and lift financial returns."