- Wendy’s (WEN -2.4%) is added to the Focus List at Citigroup, which believes same-store sales likely have been accelerated by "at least several hundred basis points” after the company introduced the 4-for-$4 promotion in October.
- Citi analyst Gregory Badishkanian says industry buzz suggests the promotion is driving strong results for WEN, leading to a rise in transactions with little to no impact on restaurants' average check total.
- The analyst predicts WEN will post Q4 same-store sales growth of at least 4%, above analyst consensus of 2.7% and the 3.3% growth implied by the high-end of company guidance.
- Badishkanian predicts McDonald's (MCD -1.4%) same-store sales growth should accelerate further in Q4 but not at the expense of WEN.
- Citi rates WEN a Buy with an $11 price target.