Waking up with fingers that look like plump sausages isn't my idea of a fun time. It seems that most restaurants' idea of good food is a little bit of basic ingredients and a whole lot of salt. Maybe their aim is to make you thirsty, but the dryness in my mouth and the Macy's Thanksgiving Day balloon effect on my body only makes me want to cook my own meals on the barbecue.
Not only does dining out these days seem to be saltier, but it's also getting more and more expensive as restaurants are passing rising commodity costs through to the prices on their menus. A case in point is Total Entertainment Restaurant
Total Entertainment was quick to blame rising food prices, which it said "equated to an approximate $0.03 per share decline in earnings." You see, that is the main problem with smaller retail chains: They don't have the critical mass (size) to spread costs and buy food products at lower prices. That is why national food chains such as Cheesecake Factory
The restaurant business is very much a here-today, gone-tomorrow existence. It's so hard to find a good restaurant that stays consistent over time. Total Entertainment Restaurant has truly hit a pothole in the road: The shares, which are down over 7% on the earnings disappointment, are trading at about 15 times the expected revised earnings estimate of $0.88 for fiscal year 2004. This downward action places the shares almost even with the earnings growth rate expectation and pushes me away from a buy consideration to look at other more deserving players in the restaurant group.
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Fool contributor Phil Wohl spent over 12 years on Wall Street and now concentrates his writing on more fictional characters. He has no stake in any firm mentioned above.