Panera Bread’s Stock Hits All-Time High on Positive Outlook



4Q16 performance

Panera Bread (PNRA), a fast-casual restaurant chain, announced its 4Q16 earnings after the market closed on February 7, 2017. The company posted EPS (earnings per share) of $2.05 on revenue of $727.1 million. From 4Q15, Panera’s EPS grew 3.7%, and its revenue grew 5.1%.

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Stock performance

Analysts were expecting the company to post EPS of $2 on revenue of $728.2 million. After posting better-than-expected 4Q16 earnings, the company has set 2017 EPS guidance at $7.45–$7.70. The EPS guidance represents a growth of 10.2%–13.9%. The better-than-expected 4Q16 earnings and positive outlook appear to have boosted investors’ confidence, leading to Panera hitting its all-time high of $234.80 on February 8, 2017. However, by the end of the day, the company was trading at $232.90, which represents a growth of 8.7% from the previous day’s closing price.

Year-to-date performance

Despite the gap between the cost of eating at home and the cost of dining out being at its peak, Panera’s stock returned 7.4% in 2016. Year-to-date, the stock has risen 13.6%. Peers Chipotle Mexican Grill (CMG) and Shake Shack (SHAK) have returned 6.8% and -1.1%, respectively.

In comparison, the Consumer Discretionary Select Sector SPDR ETF (XLY) has returned 4.0% since the beginning of 2017. XLY invests ~9.6% of its holdings in restaurant companies.

Series overview

In this series, we’ll take a look at Panera’s 4Q16 earnings call and notes. We’ll also look at the company’s performance on key metrics during the quarter, management’s guidance, and analysts’ estimates for 2017. Let’s start by discussing Panera’s revenue in 4Q16.


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