jepittman

Cheesecake Factory: Why Piper Jaffray's Downgrade Was Baseless

Wachovia securities research has some proprietary data that measures the average minutes wait for a table on friday night, the peak night for casual dining. CAKE is one of several restaurant chains measured and the data shows a slight increase in the minutes wait this year vs last year. While this does not indicate how earnings will play out it, it is a large enough sampling to indicate demand is still fairly robust. While things can still get worse, the share price appears to have already discounted a lot. Allowance for even a mild recovery out a few months looks nonexistent.

No position in CAKE, long SYY (foodservice wholesaler)