Why Griffin is buying Buffalo Wild Wings (NASDAQ:BWLD) Buffalo Wild Wings reported fourth quarter 2012 earnings of $0.89 per share, up 22% year over year, on the back of a 5.8% rise in company operated same store sales, and a 7.4% rise in franchised same store sales. To help drive future performance Buffalo Wild Wings (NASDAQ:BWLD) is undertaking various initiatives, such as menu and restaurant upgrading, and the company also has a multi-year affiliation agreement with the NCAA. Buffalo expects net earnings growth of 25% in 2013, much higher than the 17% growth in 2012. Driving this growth will be restaurant expansion.

Last quarter, Buffalo opened thirty-eight new company-owned restaurants, while shutting down one franchised restaurant. In 2013, the restaurant chain plans to open more than 60 company-owned and 45 franchised restaurants, and also expects to achieve the 1,000 total unit milestone by the end of the year. Long-term plans include opening 1,500 new units in the U.S. over the next five to seven years. As well, it is hard to see the expansion into new markets as a problem, whereas different taste preferences might make diffusion for restaurants, such as Olive Garden and Red Lobster, difficult. Buffalo's concentration of a diversified menu and beer can appeal to a wide audience. How the industry stacks up Brinker International, Inc. (NYSE:EAT) owns and develops the major  restaurants of Chili's and Maggiano's Little Italy. Unlike Buffalo Wild Wings (NASDAQ:BWLD), which does not pay a dividend, Brinker pays a 2.27% dividend yield. Chili's has excelled over the past few years thanks to its "lowest per person average check" claim, which has been influential with cost conscious customers amidst a sluggish economy. Brinker International, Inc. (NYSE:EAT) reported last quarter results that were relatively in line with consensus at earnings of $0.50 per share, but the company has robust plans for the future, hoping to double its earnings by 2015. Expansion beyond U.S. should be a key part of this, as the domestic restaurant market is somewhat saturated, Brinker has already established a strong presence in Mexico and the Middle East and hopes to open 420 more Chili's restaurants globally by 2015.

Texas Roadhouse Inc (NASDAQ:TXRH) , like the other major restaurant  operators, pays a modest dividend, yielding 2.48%. Texas Roadhouse is centered around a single chain, but it is growing. The company posted sales for the first two months of 2013 that showed sales up 2.2% year over year. On future guidance, the company expects to see positive comp sales for 2012 and open around 28 restaurants, but food inflation is expected to be upwards of 7% for the year, possibly squeezing margins. I don't necessarily like this company given it is solely dependent on its single steakhouse full-service restaurant.

Darden Restaurants, Inc. (NYSE:DRI) pays the highest dividend yield among the five restaurant stocks listed, one that yields 4.2%. The company owns and operates the major chains of Red Lobster, Olive Garden and Longhorn Steakhouse. Despite its diversified restaurant portfolio, Darden has seen some of the more robust pressure due to the economic slowdown. Darden reported last quarter results that showed under performance at in same store sales at all three top brands and earnings down 37% year over year. The company also trimmed its 2013 guidance, with sales growth for fiscal 2013 expected to be around 8.5%, versus prior expectations of 10.0%. This is the second guidance cut for Darden Restaurants, Inc. (NYSE:DRI) in the last six months. The restaurant has set 2013 comp sales growth at 1%-2%, which is below its long-term guidance range (see how Darden might manufacture a turnaround).