NEW YORK (TheStreet) -- Shares of Panera Bread Company (PNRA) are down -0.44% to $148.51 in early trading on Monday after KeyBanc (KEY) lowered its fiscal year 2015 estimates further below the consensus to $7.25 from $7.50 on concern the restaurant chain's "initiatives may be slower than expected in delivering results."
KeyCorp reiterated its "hold" rating and said it is encouraged by the long term direction of the brand.
Separately, TheStreet Ratings team rates PANERA BREAD CO as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate PANERA BREAD CO (PNRA) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and reasonable valuation levels. We feel these strengths outweigh the fact that the company shows low profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 5.8%. Since the same quarter one year prior, revenues slightly increased by 7.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. When compared to other companies in the Hotels, Restaurants & Leisure industry and the overall market, PANERA BREAD CO's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
- PANERA BREAD CO's earnings per share declined by 5.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, PANERA BREAD CO increased its bottom line by earning $6.82 versus $5.89 in the prior year. This year, the market expects an improvement in earnings ($6.86 versus $6.82).
- The change in net income from the same quarter one year ago has exceeded that of the Hotels, Restaurants & Leisure industry average, but is less than that of the S&P 500. The net income has decreased by 11.9% when compared to the same quarter one year ago, dropping from $48.12 million to $42.40 million.
- You can view the full analysis from the report here: PNRA Ratings Report