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Burger King Posts Loss, Tepid Sales
Summary: Shares of Burger King Holdings Inc. (BKC-OLD) fell 13% after the chain reported meager sales growth and a $9 million loss in its first quarterly earnings release since becoming a public company. Upbeat nevertheless, Burger King CEO John Chidsey told investors the chain is benefiting from a slowdown in spending at sit-down restaurants that is prompting some consumers to trade down to fast-food chains. But Burger King's sales results didn't show a boost from that shift. Comparable-store sales rose just 1.7% during the fourth quarter that ended June 30 -- at or just below Burger King's long-term sales-growth target. the company posted a quarter loss of $9 million, or seven cents a share, compared with profit of $2 million, or two cents a share, a year earlier. Revenue rose 6% to $533 million. Shares of BK responded in kind, shedding $2.01 a share to $13.24 in composite trading yesterday.
Comment on related stocks/ETFs: Read Investopedia Advisor's Outlook for Fast Food Stocks in This Slowing Economy, in which he predicts Burger King's current fall.