Panera's Still Unpalatable

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The pain seems far from over for Panera (Nasdaq: PNRA). Although the cafe company reported an impressive increase in total sales for the fourth quarter, a measly same-store sales increase gave investors little reason for optimism.

According to Panera, fourth-quarter revenue increased 29% to $301 million, but same-store sales rose only 1.7% for the quarter. In the month of December, same-store sales inched upward by 1.2%; the company said it lost between one and 1.2 percentage points in expected additional growth because of extreme weather in its core markets. The last time I checked, Panera's stock had dropped precipitously on today's news.

Like many eateries and retailers, including rival Starbucks (Nasdaq: SBUX), Panera also reaffirmed that it will no longer report monthly comps in its 2008 sales releases. Although many retailers who've taken this route have cited the volatility the monthly figures can bring, I suspect that some simply might not want to distribute less-than-exciting news month after month. (I wrote about this dangerous trend way back in 2006, when companies like Talbots (NYSE: TLB) and Home Depot (NYSE: HD) were scaling back their comps reporting.)

Panera will report its complete fourth-quarter results on Feb. 13. Last quarter, the company said it expected its fourth-quarter earnings to come in flat year over year. If investors aren't salivating right now, it's hardly surprising. The current macro environment remains challenging, and ultimately, Panera won't be palatable to investors until it proves it can consistently grow revenue and profits at a decent clip.

Cut yourself a slice of further Foolishness:

• Activist investors are poking at Panera.
• Last quarter, it was bread and water for the cafe operator.
• David Meier chimed in on why Panera's crusty and stale last summer.

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