This article is part of our Rising Star Portfolios Series.
About a month ago, I bought shares of Red Robin Gourmet Burgers
Red Robin still makes an attractive buy for several reasons:
- Red Robin has slowed its expansion and is focused on generating free cash flow.
- Low expectations are built into the stock, and a discounted cash flow analysis suggests shares are at least a little underpriced, and perhaps significantly.
- Activist investors own a huge slug of shares and have purchased more in the past few weeks, auguring the possibility of a buyout.
Stocks such as those of McDonald's
So for those reasons, tomorrow I'll be adding to my Rising Star portfolio's position in Red Robin.