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What: Shares of Sonic
So what: Management said same-store sales -- sales from stores open at least a year -- for the fiscal third quarter, ending next month, are now forecast to come in between 4% and 6%. Comps improved just 1.2% in fiscal Q2.
Now what: Even so, this classic burger builder is on a roll. (Yep, pun intended.) Sonic easily beat estimates in its fiscal first quarter -- and that's when comps were still declining.
Should investors take a bite of the stock? I don't see why not. Sonic trades for a small premium to the five-year earnings growth analysts estimate, resulting in a perfectly reasonable 1.23 PEG ratio. By contrast, McDonald's
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Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. McDonald's is a Motley Fool Income Investor recommendation. You can try any of our Foolish newsletter services free for 30 days.
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