| Stock (Symbol) | Stock Price | |
Buffalo Wild Wings (BWLD) |
$48 |
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| Data is as of | Expected to Report | Sector |
November 21, 2010 |
Feb 7 |
Retail & Travel |
| Sharek’s Take | ||
 Buffalo Wild Wing’s management gave guidance of 13% store growth and 18% profit growth for 2011. Since the company is usually conservative in long-term projections, expect 20-25% profit growth next year.2011 has been a little disapointing for BWLD investors, compared to other restaurant stocks which have been on-fire.I think BWLD could have some catching up to do, and as the one-year chart (below) shows, a move higher might be right around the corner. Either way I love this stock for the long-term and think it can continue to compound at 20-25% a year. |
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| One-Year Chart | ||
 BWLD formed a perfect cup-and-handle. If the stock closes above $51 we could see a move of 20% more — which would be $61. |
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| Earnings Table | ||
 Profits grew 24% last quarter on a 14% rise in sales. Last quarter sales rose 12% and profits were up 28%. BWLD is getting good food prices, which is helping profits.BWLD beat by 4 cents last quarter, but this stat isn’t very relavant as there’s a lot of graan and red in the earnings table when it comes to upping/beating/lowering/meeting (I’m rhymin — and stealin). Annual estimates are around what they were last quarter. Quarterly estimates declined a little, after rising a little last quarter. Overall, 20-25% growth should be achievable on average. |
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| Fair Value | ||
 I would like to give this stock a fair value of 30 times earnings, but with teens profit growth estiamted in quarterly estiamates, a 25 P/E is reasonable. |
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| Ten-Year Chart | ||
 Buffalo Wild WIngs’ annual profits have always been up by at least 18% a year since the stock went public. The stock’s decade chart shows a choppy ride higher. The restaurant industry is good right now, so the net leg could be up. This stock is good for the short-run because estimates are rising, its also good for the long-run because the P/E of 20 is lower than the 25 I think the stock is worth. |
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| Power Ranking | Bottom Line | |
Growth Portfolio
13 of 17 |
In the one-year chart I pointed out a breakout could lead this stock to $61. In the Fair Value calculation, $62 is a fair price for BWLD. $61 to $62 is clearly what Buffalo Wild WIngs stock should be selling for in 2011 — which equates to upside of 27-29%, and is consistent with BWLD’s history. BWLD is ranked13th in the 18 stock Growth Portfolio Power Rankings and 8th in the 10 stock Aggressive Growth Portfolio Power Rankings. I really like this stock and feel it should be ranked higher, but the stocks above BWLD in the Power Rankings are hotter. BWLD has to break out of its cup-and-handle — then it should be on its way to $61. |
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Aggressive Growth Portfolio
9 of 10 |
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