If you have yet to eat lunch, I’d definitely recommend you do so. This article will leave you feeling hungry for food and hungry for investment. We’re going to be taking a look at three beloved restaurant chains that layer the contiguous United States.
On deck, we have one of my favorite places to go and relax, Buffalo Wild Wings (NASDAQ:BWLD). We’ll follow up the chicken wings with some family style Italian food provided by Darden Restaurants, Inc. (NYSE:DRI), and then to complete the feast we’ll grab an ice-cold beer from BJ’s Restaurants, Inc. (NASDAQ:BJRI).
Wings, Beer, Sports.
Buffalo Wild Wings (NASDAQ:BWLD) has long been a favorite restaurant of mine. For those that haven’t been, you’re missing out. The places are dimly lit, and full of flat screen TVs to catch the latest in sports. They also serve a great selection of food and alcoholic beverages. It’s no wonder that this company has been on the growth path it has over the last few years.
Buffalo Wild Wings (NASDAQ:BWLD) has managed to grow its stock price by over 275% over the last five years. What could have been bought in 2008 for around $25 per share is now setting you back close to $100. This isn’t just speculative buying either. Sales in 2008 were $422 million, and they’ve grown to over a billion dollars per year.
Currently this stock can be yours for 31 times earnings. That’s well above the industry average P/E of 24. Throw in the analyst’s expected 2013 growth of 18%, though, and you’re looking at a much better forward P/E.
The growth in 2014 isn’t expected to slow down either. Analysts have it pegged at 20%. With this kind of expected growth, I think you’d be silly not to buy in at these levels.
A More Diversified Play
Darden Restaurants, Inc. (NYSE:DRI) is no doubt a more diversified restaurant play than that of Buffalo Wild Wings (NASDAQ:BWLD). Darden Restaurants, Inc. (NYSE:DRI) is the parent of brands such as Olive Garden, Red Lobster, and Longhorn Steakhouse.
For those of you that like a dividend, and a more fairly priced restaurant, you’re going to find it here. Darden Restaurants, Inc. (NYSE:DRI)pays a dividend that yields 3.9%, and this dividend has been growing by an exceptional 22% over the last five years.