While the results were no doubt solid, Wall Street expected more and Goldman Sachs lowered its price target on shares, which sent the stock down over 9%. Still, now is probably not a good time to sell your shares.
This is a rare restaurant, along with fellow heavy-weights Chipotle (NYSE:CMG) and Starbucks (NASDAQ:SBUX), that should be depended on to innovate. Three key principles that these restaurants share in common, give me confidence.
Examining the quarter
While many headlines said that the results were "mixed," they were only mixed because analysts expected slightly more revenue. One piece of Foolish advice I'd recommend is to ignore analysts expectations, which are wrong nearly half the time; rather, you should focus on the organic growth of the business in question.
Buffalo Wild Wings bucked the "bad weather" trend that has hammered most retail, and even restaurant establishments, by posting strong comps. The only two names that did as well this quarter are Chipotle, which posted a staggering 9.3% comparable sales figure, and Starbucks posted comparable sales of 6% on a 4% increase in store traffic.
Buffalo Wild Wings same-store sales growth was at 5.2%. While total revenue's came in at 12%, the same-store (or comparable) increase means more. Restaurants are relatively simple businesses to analyze; comparable store sales, new store openings, and overhead costs, will tell you about 90% of the story.
With nice comparable sales and a plan to open 13 franchise restaurants this quarter, Buffalo Wild Wings is doing well. Can it last?
Buffalo Wild Wings: a Rule Breaker?
Most people wouldn't think of Buffalo Wild Wings as a stock that could be in The Motley Fool's Rule Breaker's Newsletter, but perhaps they should. In their book Million Dollar Portfolio Motley Fool Co-Founders, David and Tom Gardner, explained that "rule breaking stocks" disrupt competitors or create markets that didn't exist.