“We maintain our Hold rating and $84 fair value estimate on Buffalo Wild Wings (BWLD) following a third consecutive disappointing earnings quarter in 4Q12. Margins deteriorated once again despite stellar same-restaurant sales in the December quarter, and we now think a moderation in headline comps, stubbornly high wing costs, and a lack of leverage on the labor cost line will make it more difficult for BWLD to return to margin expansion in 2013. We argue BWLD’s popularity in recent years has been bolstered by its reputation for value within the mid-scale bar-and-grill segment, but caution aggressive menu pricing will continue to be felt least through 1H13, and for this reason we are concerned about a loss in traffic. We expect BWLD shares to reverse recent gains today, but think any post-earnings decline will be limited by (1) our contention that a second concept now is likely to come sooner rather than later, thus giving BWLD another avenue for growth; and (2) the potential for a short squeeze given BWLD’s industry-leading short position as a percentage of the total share float.,” Miller Tabak’s analyst wrote.
Shares of Buffalo Wild Wings traded up 1.59% during mid-day trading on Wednesday, hitting $78.50. Buffalo Wild Wings has a 52 week low of $68.71 and a 52 week high of $94.81. The stock’s 50-day moving average is currently $75.63. The company has a market cap of $1.462 billion and a P/E ratio of 25.25.
A number of other firms have also recently commented on BWLD. Analysts at Deutsche Bank reiterated a buy rating on shares of Buffalo Wild Wings in a research note to investors on Wednesday. They now have a $90.00 price target on the stock, up previously from $85.00. Separately, analysts at Robert W. Baird reiterated an outperform rating on shares of Buffalo Wild Wings in a research note to investors on Tuesday. They now have a $100.00 price target on the stock. Finally, analysts at KeyBanc upgraded shares of Buffalo Wild Wings to a buy rating in a research note to investors on Monday.
Eleven investment analysts have rated the stock with a buy rating, two have issued an overweight rating, seven have given a hold rating, and one has assigned a sell rating to the company. Buffalo Wild Wings presently has an average rating of overweight and an average target price of $86.12.
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