Chipotle Leading the Pack

The analyst attributed Chipotle's dramatic stock increase Friday to profit taking on a short squeeze, or investors who had shorted the stock covering their positions by purchasing shares.

Huntington Beach, Calif.-based BJs also enjoyed significant gains in revenues and earnings last quarter. DiFrisco was impressed by the small brand's ability to expand outside its native California market, citing double-digit comp trends in Ohio where the chain has four stores. By comparison, California Pizza Kitchen(CPKI) experienced some difficulties when it moved to expand outside its home state, the analyst said.

BJ's strong showing offered promise of similarly healthy margins over time as it continues to spread out in the U.S.

Conversely, Cheesecake's comp numbers were relatively soft at under 2%, and the figure slowed from May to June. In California it reported a 1% decrease in comps, a cause for concern, DiFrisco said.

Cheesecake also suffered a decline in average check totals "as incremental customers looked to spend less and play on the menu at lower price points." If consumers continue to bring in less money and the restaurant chain continues to have the same fixed costs, it will eventually breed lower margins, DiFrisco noted.

-- Reported by Miriam Marcus Reimer from New York.

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