NEW YORK (TheStreet) -- Shares of Burger King Worldwide (BKW) are slightly up 0.8% to $26.34 in early market trading despite the recent food scare in China that's affecting the hamburger meat it receives from a supplier that used product from Shanghai Husi Food Co.
Shanghai food regulators shut down the Husi factory on Sunday, pending an investigation into the allegations, Reuters reports.
TheStreet Ratings team rates BURGER KING WORLDWIDE INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate BURGER KING WORLDWIDE INC (BKW) a BUY. This is driven by multiple 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 solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, expanding profit margins and good cash flow from operations. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Powered by its strong earnings growth of 70.00% and other important driving factors, this stock has surged by 33.26% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
- BURGER KING WORLDWIDE INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, BURGER KING WORLDWIDE INC increased its bottom line by earning $0.66 versus $0.34 in the prior year. This year, the market expects an improvement in earnings ($0.95 versus $0.66).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry. The net income increased by 68.7% when compared to the same quarter one year prior, rising from $35.80 million to $60.40 million.
- The gross profit margin for BURGER KING WORLDWIDE INC is currently very high, coming in at 83.52%. It has increased significantly from the same period last year. Along with this, the net profit margin of 25.07% significantly outperformed against the industry average.
- Net operating cash flow has significantly increased by 58.80% to $125.30 million when compared to the same quarter last year. In addition, BURGER KING WORLDWIDE INC has also vastly surpassed the industry average cash flow growth rate of -21.57%.
- You can view the full analysis from the report here: BKW Ratings Report