Yum! Brands, Inc. (YUM), Panera Bread Co (PNRA), Brinker International, Inc. (EAT): Same Industry, Same Earnings Release Date, But Different Outlooks

The earnings season is on the go and we just heard from the first few restaurant/fast-food companies. But we’ll not have to wait long for the next three American restaurants, expected to report on April 23; I have shortlisted them and decided to do an earnings preview.

Yum! Brands, Inc. (NYSE:YUM) is the first stock to be discussed. The Street expects the stock to report EPS of $0.58 and revenue of $3.04 billion. Yum! Brands, Inc. (NYSE:YUM) has operations in both the US and internationally. The restaurant chain calls its outside US business by the name of Yum! Brands, Inc. (NYSE:YUM) Restaurant International or simply YRI.

The Street is pretty bullish on operations within the US. However, as far as YRI is concerned, growth seems to be limited. The growth is especially threatened by a weak Chinese economy. This is why, despite an earnings beat, the stock may not move up given a weak forecast for 2013. Similarly, Goldman is meaningfully below consensus for the full-year and does not recommend bidding the shares higher even in the event of a strong quarterly print. China results are the primary driver, and thus the market is looking to better understand the margin dynamics in that geography given the meaningful fall-off in sales. This, and further color around the recent bird flu outbreak, may trump all other areas of the P&L.

Panera Bread Co (NASDAQ:PNRA) is another player on the list that is expected to announce its quarterly result on the same date. The bakery café chain has been the talk of the town lately. It recently launched a new marketing campaign, which is said to be a successful one (in 2Q13)

The company is expected to post EPS of $1.65 and revenue of $566.3 million. Though, the company might not be able to top the results given that the consensus estimates are expected to truly reflect the performance of the company in 1Q13. However, investors might see a rally in the stock given some positive commentary on April numbers.

The company’s two-year same-store-sales (SSS) run rate has been running in the +12% range, which implies an acceleration to 6-7% SSS in April. There could be upside to that figure if Panera Bread Co (NASDAQ:PNRA)’s new marketing campaign or pasta launch drives incremental traction with consumers.

At this point, bears might want to say that this rally could be a temporary one given the temporary nature of the marketing campaign itself. However, this might not be true given that strong fundamentals will likely drive further upside in the shares.