NEW YORK (TheStreet) -- Wendy's (WEN) shares are up 4.79% to $10.94 in afternoon trading on Wednesday following the release of the fast food restaurant's first quarter earnings results and the announcement that it is selling its bakery business as well as 640 company-owned stores.
The Dublin, OH-based company reported first quarter net income of $27.5 million, or 7 cents per share which topped analysts expectations by 2 cents. Revenue of $466.2 million failed to meet analysts' $478 million guidance.
Separately, the company said that it plans to sell off its bun making business later this month while also providing details on its plan to sell 640 of its company-owned stores to franchisees. Wendy's said that it plans to sell 380 restaurants this year and 260 restaurants next year as part of the company's previously announced intention to own just 5% of its stores.
Wendy's expects the sale of the bun-making business to close sometime this month. The Ohio-based business supplies Wendy's with its sandwich buns, bringing in $62 million in revenue last year.
TheStreet Ratings team rates WENDY'S CO as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate WENDY'S CO (WEN) 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 largely solid financial position with reasonable debt levels by most measures, solid stock price performance and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income."