Buffalo Wild Wings (NASDAQ:BWLD) is on a roll these days, and its new plan to acquire emerging restaurant brands in the burgeoning fast-casual space could push the stock even higher. Shares have climbed more than 266% over the past five years to roughly $144 a pop today. Let's look at why Buffalo Wild Wings' latest investments could be a catalyst for the stock going forward.

Source: Buffalo Wild Wings.

Investing in start-ups
Buffalo Wild Wings recently acquired a majority stake in Rusty Taco, a Dallas-based Mexican chain that serves made-to-order street-style tacos. Rusty Taco is the latest addition to Buffalo Wild Wings' growing portfolio of fast-casual start-ups. Less than two years ago, Buffalo Wild Wings also took a strategic position in PizzaRev, a chain that lets customers craft custom artisanal pizza in a Chipotle (NYSE:CMG)-style environment.

These strategic investments are particularly well timed, as Tex-Mex food and custom pizza are two of the hottest categories in fast-casual dining today. In fact, Chipotle set its sights beyond Mexican food last year when it launched the fast-casual eatery chain Pizzeria Locale.

Source: Pizza Rev.

Buffalo Wild Wings isn't trying to directly compete with Chipotle with its recent investments in Rusty Taco and PizzaRev. Rather, these investments are part of the company's longer-term growth strategy. By bringing in small emerging brands, Buffalo Wild Wings gains an entry point into the fastest-growing segment of the restaurant industry today: fast casual.

The company isn't wasting any time executing this plan. Buffalo Wild Wings CEO Sally Smith said the company wants to acquire between three and five different emerging restaurant brands over the next few years.

The chicken wings and sports-focused chain currently operates 1,000 Buffalo Wild Wings restaurants in the United States. While management plans to add roughly 700 locations, there is a limited amount of growth possible before Buffalo Wild Wings saturates the U.S. market. Therefore, investing in small scale fast-casual chains such as Rusty Taco and PizzaRev gives Buffalo Wild Wings a new growth channel outside of its core business.

These investments are also smart moves for both emerging chains, which can leverage Buffalo Wild Wings' experience in growing a successful restaurant business. With the help of Buffalo Wild Wings, Rusty Taco and PizzaRev have the potential to become national restaurant chains.

Growing through franchises
Buffalo Wild Wings had 579 franchise-operated restaurants open at the end of its second quarter, more than half its total location count. The company is using this knowledge of franchising to help PizzaRev and Rusty Taco grow their businesses.

Buffalo Wild Wings opened its second PizzaRev franchise restaurant in Minneapolis last month. The pizza chain plans to open additional franchise locations in the following markets: Minnesota, Utah, Nebraska, South Dakota, Missouri, Texas, and Orange County and San Diego in California.

Buffalo Wild Wings has a similar arrangement with Rusty Taco. "We are delighted to be partnering with Buffalo Wild Wings and believe it can have an immediate impact in helping accelerate our growth," said Rusty Taco CEO Steve Dunn in a press release. The Tex-Mex upstart currently has two company-owned restaurants and seven franchised locations in three U.S. markets. You can expect many more franchised locations to pop up soon now that Buffalo Wild Wings has a majority stake in the company.

What it all means for Buffalo Wild Wings
Buffalo Wild Wings' investment in these start-up businesses is a smart long-term move that supports the company's drive to build a portfolio of emerging brands that could become national chains down the road. It also positions Buffalo Wild Wings as a more dynamic restaurant company by diversifying its revenue streams.