Will This Analyst Upgrade Help Panera Bread (PNRA) Stock Today?

NEW YORK (TheStreet) -- Barclays upgraded Panera Bread  (PNRA) to "overweight." The firm said the leader in fast casual should benefit from continued rollout of modifications to locations.

The stock was up 1.06% to $153.35 in pre-market trading on Wednesday.

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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 few notable 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, reasonable valuation levels, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and notable return on equity. 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 5.4%. Since the same quarter one year prior, revenues slightly increased by 7.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Net operating cash flow has increased to $82.06 million or 27.03% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -21.67%.
  • PNRA's debt-to-equity ratio is very low at 0.14 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.88 is somewhat weak and could be cause for future problems.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison to other companies in the Hotels, Restaurants & Leisure industry and the overall market on the basis of return on equity, PANERA BREAD CO has underperformed in comparison with the industry average, but has greatly exceeded that of the S&P 500.
  • You can view the full analysis from the report here: PNRA Ratings Report

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Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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