Why it’s important to understand Noodles and Co.

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Company overview

Noodles & Company (or NDLS) was founded in 1995. It’s a fast-casual restaurant chain that serves classic noodle and pasta dishes. It operates worldwide with 343 company-owned restaurants and 67 franchise restaurants in 410 locations system-wide. As of July 1, 2014, it’s in 31 states and the District of Columbia.

NDLS - Logo

Globally-inspired menu

The company has a globally-inspired menu, “Known as Your World Kitchen.” It includes more than 25 fresh and customizable noodle bowls, salads, soups, and sandwiches that are prepared quickly using quality ingredients. From healthy to indulgent, spicy to comforting, the menu provides favorites for everyone from kids to adults.

Popular dishes include the Med Salad with grilled chicken, spicy Indonesian Peanut Saute, and creamy Wisconsin Mac & Cheese.

Selection criteria for opening a new restaurant 

In order to open a new restaurant, Noodles & Co. has a selection criteria that includes location, capital investment, and other factors. NDLS looks for strong middle-income neighborhoods with a fair amount of population density.

With core criteria revolving around demographics, the company combines it with a pretty rigorous site checklist that includes physical plant, visibility, access, and parking. Being an expensive, long-term decision for the company’s growth, NDLS follows its selection criteria closely.

The company CEO, Kevin Reddy, believes that from a hospitality standpoint, NDLS gives an experience closer to casual dining with the speed and price point of fast casual.

NDLS’s peers are Panera Bread Company (PNRA), Chipotle Mexican Grill (CMG), Popeye’s Louisiana Kitchen (PLKI), and Papa John’s International Inc. (PZZA).

For the broader industry perspective, investors can look at the PowerShares Dynamic Leisure and Entertainment (PEJ) and the PowerShares Dynamic Food & Beverage (PBJ).

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In this series, we’ll discuss the company’s strengths, initiatives, strategies, and risks. We’ll also look at the new catering program that NDLS undertook for its stable future growth. With its recent earnings release, we’ll discuss the second quarter earnings ending July 1, 2014. Finally, we’ll analyze the company’s outlook and the CEO’s opinion about the company.

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