Shaun Currie, CFA
Long/short equity, hedge fund analyst, momentum

Ruby Tuesday: Updating The Story After Quarterly Earnings

Ruby Tuesday, Inc. (NYSE:RT) recently reported Q1 2014 earnings. Headlined by a negative 11.4% percent comp, the stock dropped 17% percent. We will get into more highlights of the call in this article, but the main thesis is: performance in not improving, and if it does improve its going to take awhile to see it. Because of this, I cannot be a believer in the turnaround strategy. Real estate value supports a stock price around $6, but that would include a successful, non-distressed monetization. With the performance of the company, this becomes less likely.

The Big Picture

I thought the most important piece of this call was management's acknowledgement of the fundamental issue that is troubling the...

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