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Restaurant Companies Deliver Results

Bloomin' Brands is the new kid on the block, having gone public last August. But the company's brands, which include Outback Steakhouse, Bonefish Grill and Carrabba's, have been around for quite a while.

This is a fairly large operator, with 1,471 restaurants in 48 states and 21 countries. First-quarter EPS of 50 cents handily beat the 44-cent consensus.


This name is somewhat new to me, but I'll be doing some work on it. The company ended the first quarter with $217 million in cash and $1.46 billion in debt. That's more debt than I typically like to see, but the company also owns the real estate for 20% of its locations. Since the IPO, shares are up nearly 90%.

Lastly, Del Frisco's, which runs 34 upscale steakhouses, reported earnings of 21 cents, a penny better than the consensus, while revenue of $59.8 million topped the $58.5 million analyst consensus. The company went public last July, and shares are up 33% since then. Talk about contrasts in restaurant concepts -- Denny's vs. Del Frisco's -- but both still managed decent quarters.

We did see the effects of higher input costs on Monday, when Buffalo Wild Wings (BWLD) reported a worse-than-expected quarter due to higher chicken wing prices. That may be a case where the company's pricing power is somewhat limited. As much as I love wings and consider them to be one of the major food groups, I find Buffalo Wild Wings prices to be on the high side. I would opt to make my own at home rather than pay those prices. Things sure have changed since the $10 buckets of wings during the college days at the original Quaker Steak and Lube in Sharon, Pa.!

At the time of publication, Heller had no positions in stocks mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Jonathan Heller, CFA, is president of KEJ Financial Advisors, his fee-only financial planning company. Jon spent 17 years at Bloomberg Financial Markets in various roles, from 1989 until 2005. He ran Bloomberg's Equity Fundamental Research Department from 1994 until 1998, when he assumed responsibility for Bloomberg's Equity Data Research Department. In 2001, he joined Bloomberg's Publishing group as senior markets editor and writer for Bloomberg Personal Finance Magazine, and an associate editor and contributor for Bloomberg Markets Magazine. In 2005, he joined SEI Investments as director of investment communications within SEI's Investment Management Unit.

Jon is also the founder of the Cheap Stocks Web site, a site dedicated to deep-value investing. He has an undergraduate degree from Grove City College and an MBA from Rider University, where he has also served on the adjunct faculty; he is also a CFA charter holder.

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