AFC Enterprises (AFCE)
Company Profile: AFC Enterprises operates and franchises quick-service restaurants under the brand names Popeyes Chicken & Biscuits and Popeyes Louisiana Kitchen.
Share price return: 10.3% this year
Franchise locations: As of Dec. 26, the company had 1,542 domestic franchised restaurants, 397 international franchised restaurants and 38 company-operated shops.
Revenue from franchises: Franchise revenue accounted for 62% of AFC's $46.8 million in total revenue last quarter. Sales at company-owned locations was $17.6 million, compared with $27.9 million in revenue from franchises and $1.3 million in rental and other revenue.
Franchise costs: The basic requirements for owning a Popeyes franchise is a net worth of $500,000, of which $250,000 must be liquid. After that requirement is met, AFC Enterprises has several franchise fees, including a $7,500 development fee per restaurant, a $30,000 franchise fee per restaurant, a royalty fee of 5% of gross sales and an ad fund that takes 4% of gross sales. These fees don't address other project costs, such as the $330,000 to $420,000 required for a building, $150,000 to $170,000 in equipment costs, and signage, which can run from $15,000 to $30,000.
Analyst view: Of the six analysts covering AFC Enterprises, half rate it a "buy" and the other half say investors should hold onto shares. BGB Securities is among the bullish firms, while Cowen & Co. say investors should sit tight.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV