Fast casual chains struggle to match Chipotle's recipe for growth


Shares of Noodles (NDLS) and Panera Bread (PNRA) trade lower in premarket action after the fast-casual restaurant chains fail to come anywhere close to matching the double-digit comparable-sales growth that Chipotle (CMG) churned up for the first quarter.

Restaurant sector analysts have noted that speed of service and simplicity of menu are two significant factors in the segment.

Panera Bread is addressing its "mosh-pit" order pickup issue, while Noodles thinks it can regain traffic to bring scale back into play for margin expansion.

Execs with both companies made a strong case during their earnings calls that Q1 results were due to transitory or one-time factors.

Conference call transcripts: NDLS, PNRA

Premarket: NDLS -6.5%, PNRA -5.6%, CMG -0.3%

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Comments (3)
  • Stan Ackman
    , contributor
    Comments (1927) | Send Message
     
    PNRA's menu is indeed too complicated. The high price tag and small portion basically make PNRA not near as competitive as CMG.
    30 Apr 2014, 11:08 AM Reply Like
  • papita
    , contributor
    Comments (412) | Send Message
     
    Last time I went into Panera, the portion was so small and the sandwich was so cheap that I had to make a complaint and they gave me a coupon for a free lunch. I was in Chipotle last weekend and I ordered a burrito. not only did it take less than 2 minutes to get my lunch, but I had the opportunity to make it the way I wanted it. Me, my wife and 1 other ate for $25 with drinks. And when we left, we were full. There is the difference in a nutshell.
    30 Apr 2014, 11:35 AM Reply Like
  • StopPrintinMoney
    , contributor
    Comments (304) | Send Message
     
    have to agree with you on Panera. We had lunch there yesterday (not the first time, mind it).
    The *u-pick*2* deal might look good on the paper menu, but in reality the portions are so small, you feel cheated when done.
    19 May 2014, 07:43 AM Reply Like
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