For Immediate Release
Chicago, IL – February 5, 2010 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Burger King Holdings Inc. (BKC), McDonald’s Corporation (MCD), Yum! Brands, Inc. (YUM), Chipotle Mexican Grill, Inc. (CMG) and Sara Lee Corp. (SLE).
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Here are highlights from Thursday’s Analyst Blog:
Burger King’s Profit Climbs
Despite the macroeconomic headwinds faced by Burger King Holdings Inc. (BKC), the second largest hamburger chain after McDonald’s Corporation (MCD), its second-quarter 2010 profit climbed 13% year-over-year to $50.2 million on the heels of “Value Menu” offerings and favorable currency movements.
Consequently, the shares of Burger King rose about 6.5% on an overall down day in the market as of mid-day Thursday.
Burger King’s quarterly earnings of 37 cents a share comfortably surpassed the Zacks Consensus Estimate of 34 cents, and rose 12% from 33 cents delivered in the prior-year quarter. In the last 7 days, the Zacks Consensus Estimate has fallen about 3% with 2 out of 20 analysts covering the stock lowering their estimates substantially.
Burger King’s quarterly earnings outperformed the Zacks Consensus Estimate by 9%. The company’s earnings surprise history for the preceding four quarters varies between negative 11% and positive 30%, with the average being positive 4%.
Burger King’s total revenue for second-quarter 2010 rose 2% to $645.4 million due to the favorable impact of currency movements and a net increase in the number of franchise restaurants, partly offset by a fall in comparable sales. Company restaurant revenue inched up 1% to $476.9 million; franchise revenue climbed 5% to $140.3 million, whereas property revenue grew 3% to $28.2 million.
By geographic segment, revenue in U.S. & Canada dropped marginally by 1% to $429.1 million, EMEA/APAC jumped 9% to $187.9 million and Latin America rose 4% to $28.4 million.
Comparable sales for the quarter slid 2% in the quarter after declining 2.9% in first-quarter 2010, showing a slight improvement, but still remained affected by lower discretionary spending and raging discounting wars among restaurant operators to attract consumers. This has toughened the competition Burger King has to face from Yum! Brands, Inc. (YUM), Chipotle Mexican Grill, Inc. (CMG) and McDonald’s.
Sara Lee Beats Estimates
Sara Lee Corp. (SLE) reported strong operating income growth for the second quarter of fiscal 2010, driven by significant improvement in operating segment income across the company, particularly in the North American Retail and International Beverage business segments, and lower corporate expenses.
Net income was $66 million in the second quarter versus $23 million in the year-ago period. EPS was 43 cents compared to a loss of 6 cents during the same period of fiscal 2009. Reported EPS was well above the Zacks Consensus Estimate of 23 cents.
Net sales of $2.9 billion were same as the year-ago period as the favorable foreign currency exchange rate gains were partially offset by the impact of divestitures, slightly lower unit volumes, and lower selling prices. Total Sara Lee unit volumes increased by 1.0% year over year due to innovative new products, successful trade spending and strategic pricing initiatives taken by the company during the quarter.
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