Restaurant Winners and Losers: Burger King

Updated from 3:19 p.m. ET

Both Burger King(BKC Quote) and McDonald's(MCD Quote) will likely report profit and sales growth this year while Yum Brands(YUM Quote) may be hurt by the downturn in the global economy and currency exchange rates, a Robert W. Baird & Co. analyst said Friday.

Analyst David E. Tarantino initiated coverage on both Burger King and McDonald's with "outperform" ratings and started coverage on Yum Brands with a "neutral" rating.

He said in a note to investors that Burger King should deliver annual earnings per share growth of 13% to 16% and growth in same-store sales -- or sales at stores open at least a year -- of at least 2% to 3%.

"Our rating reflects a positive view of fundamentals, long-term prospects and valuation," he said, adding that he expects "solid near-term" results despite lower consumer spending and unfavorable exchange rates.

Tarantino said he expects earnings per share to rise 5% in fiscal 2009 and 10% in the third quarter.

The analyst has a $28 price target on the stock, meaning he expects the shares to rise 25% from Thursday's closing price of $22.43 in the next year.

Tarantino said McDonald's should be able to "capitalize on a globally recognizable brand, excellent value proposition, and powerful operating platform to deliver healthy near- and long-term results."

He said he believes the company will likely see earnings per share grow by 9% to 12% annually with same-store sales rising between 2% and 4%.

He expects earnings per share to rise 4% in fiscal 2009, adding profit will likely meet Wall Street analysts' estimates for the fiscal first quarter.