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3 Restaurant Stocks to Buy Now

Drop Burger King and add these three restaurant stocks to your portfolio now.

NEW YORK (

TheStreet

) -- Restaurant stocks were a hot topic on Wall Street this week as private equity buyouts circulated -- and were then confirmed -- surrounding

Burger King Holdings

(BKC)

.

Sonic

(SONC)

,

Wendy's Arby's Group

(WEN) - Get Report

,

Jack in the Box

(JACK) - Get Report

,

California Pizza Kitchen

(CPKI)

and Chili's operator

Brinker International

(EAT) - Get Report

have also been tapped as potential restaurant stocks that may be targets for private-equity buyouts, helping to push their share prices higher in trading Thursday.

>>Burger King Agrees to Buyout

Burger King shares surged 25% to close at $23.58 on more than 42 times their average trading volume.

Stifel Nicolaus analyst Steve West told

TheStreet

now is the time to sell Burger King shares

, on the view that the stock is unlikely to rise much higher. Some arbitration shops may still make some money on the stock, potentially filing suits arguing for a higher-priced deal, but "I don't think any more upside will be material," he said.

>>Bankruptcy Watch: 20 Riskiest Restaurant Stocks

At this point it's a little too late in the game for investors to make much hay from Burger King shares. Instead, West tapped

Panera Bread

(PNRA)

as his top pick in the restaurant sector, followed by sector darling

Chipotle Mexican Grill

(CMG) - Get Report

, as stocks savvy investors should look to now.

TheStreet Recommends

West also had a buy rating on industry behemoth

McDonald's

(MCD) - Get Report

, arch rival to Burger King.

Hedge fund 3G will pay $24 in cash for each share of Burger King, a 45.9% premium to the Whopper-and-fries chain's closing price on Tuesday, before rumors of the buyout began circulating on Wall Street.

Restaurant stocks soared on Thursday, with Burger King clearly outpacing the sector.

>> Restaurant Winners: Burger King

DineEquity

(DIN) - Get Report

, operator of IHOP and Applebee's restaurants, closed up by 11.1% while Brinker added 9.1%.

Biglari Holdings

(BH) - Get Report

, a holding company that recently

more than doubled quarterly profits

thanks to a stronger performance at its Steak n Shake restaurants and to its acquisition of Western Sizzlin, jumped 7.1%.

-- Written by Miriam Marcus Reimer in New York.

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Miriam Reimer

.

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.

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.

RELATED STORIES:

>> Burger King Agrees to Buyout

>> Restaurant Winners: Burger King

>> Sell Burger King Shares Now: Analyst

>> Bankruptcy Watch: 20 Riskiest Restaurant Stocks

>> Burger King Grilled by Analysts

>> Burger King Beats, Looks Abroad for Growth

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Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.