Stuck on Chuck E.

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Chuck E. Cheese bills itself as a place where a kid can be a kid, but investors have been getting in on the fun, too. Shares of parent company CEC Entertainment (NYSE: CEC) have doubled over the past year, riding a respectable financial showing in 2003 that were fueled by its own special sauce.

So, how did this colorful, noisy, and highly interactive pizzeria concept grow earnings per share from $2.46 to $2.62 this past year despite a negligible uptick in profits? By putting its tokens where its mouth is: CEC pulled off an ambitious share buyback last year. The top line brought its own helium. Healthy expansion overcame a small dip in comps, boosting revenues 9% to $654.6 million on the year.

With nearly 500 company-owned or franchised locations, CEC's flagship chain has been a magnet for kid parties, festive family outings, and those seeking out a tastier pizza than one would expect from a place that seems to rely more on eye candy than grub to feed its registers.

And make no mistake, kid concepts are risky business. When burger chains like McDonald's (NYSE: MCD) and Burger King started rolling out super-sized playgrounds and ball pits, it wasn't long before Discovery Zone's days were numbered. Chuck E. Cheese survives because it's a great brand a la Steak n Shake (NYSE: SNS) or Krispy Kreme (NYSE: KKD).

We're now in the dreary winterish season that CEC eats up like a rodent on a block of provolone. Kids. Boundless energy. Indoor nirvana. You connect the dots. That's why this will be the company's strongest quarter on the road to an expected $1.16 a share and 20% growth in 2004.

All the same, and despite the recent run and the high expectations, the stock looks surprisingly reasonable. It closed yesterday at just 16 times this year's projected profits. Not too shabby -- for a rodent.

Are kid-oriented entertainment centers like Chuck E. Cheese a worthy diversion or are we breeding next-generation gamblers? Are these centers more or less conducive to germs than your typical classroom? What are some other indoor alternatives for bad weather days? All this and more -- in the Parents and Expecting Parents discussion board. Only on Fool.com.

Fool contributor Rick Munarriz went to a Chuck E. Cheese with his kids just twice last year. He's a Skee-ball demon. He also owns shares in Krispy Kreme.