Is Wendy's No One's Fast-Food Fiancee?

One has to wonder whether Wendy's (NYSE: WEN  ) will ever get hitched.

Shares of the country's third-largest burger chain fell 5% yesterday after posting disappointing fourth-quarter results. Income from continuing operations climbed 42% higher to $0.16 a share during the period, or up 24% to $0.21 a share after backing out restructuring-related expenses from both quarters. Wall Street was expecting a profit of $0.23 a share.

Total revenues clocked in flat at $596 million, with franchised unit gains offsetting slight dips in sales, comps, and the unit count of its company-owned restaurants. Wendy's also failed to wow shareholders during its third quarter.

This would be acceptable if the fast food industry was in a slump, but several of its burger-flipping rivals are doing just fine. Burger King (NYSE: BKC  ) has posted positive comps for 16 consecutive quarters. McDonald's (NYSE: MCD  ) may have had a flat December, but it too grew its comps for the quarter. More importantly, Burger King, McDonald's, and Sonic (Nasdaq: SONC  ) all beat analyst profit targets in their latest quarters.

The slump comes at a terrible time. Wendy's has been seeking "strategic options" since last April. Now that it has sold off its Cafe Express and Baja Fresh concepts and spun off Tim Hortons (NYSE: TMI  ) , the company is riding exclusively on its namesake chain.

Wendy's isn't hideous, so where are the suitors? Weren't private equity firms and Arby's-parent Triarc (NYSE: TRY  ) angling for Wendy's last summer? That enthusiasm seems to have gone the way of the Frescata (discontinued) or the red wig campaign (on the way out, replaced by a softer ad with an animated version of the Wendy's character).

Because financing concerns have been keeping privatization offers in check, Wendy's may very well have to go it alone. It's doing what it can, via aggressive share buybacks and gradually rolling out breakfast throughout its chain. However, it has to be disheartening to see comps fall at its company-owned stores despite the addition of the earlier breakfast hours at some of those locations.

Wendy's must have thought that it was holding a hot hand last year, especially after its shares climbed past $40 shortly after going public with its plans to smoke out a suitor. However, now that the stock has shed nearly half of its May highs, it turns out that Wendy's wasn't playing poker. It was playing Old Maid.

It's the wrong game at the wrong time. Shareholders hoping for a fresh deck will have to be patient.

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