On March 24, 2017, Panera Bread (PNRA) stock hit its all-time high of $250.53 and closed the day at $249.48. That’s a 16.4% rise since it announced its 4Q16 earnings on February 7, 2017.
In 4Q16, Panera posted adjusted EPS (earnings per share) of $2.05 against analysts’ estimate of $2. After a strong 4Q16, management set EPS guidance of $7.45–$7.70 for 2017, which represents a year-over-year rise of 10.2%–13.9%.
Better-than-expected 4Q16 earnings, a positive outlook, and measures adopted by the company to improve sales appear to have increased investor confidence. That led to a rise in Panera stock.
Since the beginning of 2017, PNRA stock has risen 21.6% compared to 7.4% in 2016. A strengthening US economy has also contributed to the rise of Panera stock. Its peers Chipotle Mexican Grill (CMG) and Shake Shack (SHAK) have returned 9.7%, and -9.6%, respectively, year-to-date.
The Consumer Discretionary Select Sector SPDR ETF (XLY) has returned 6.3% year-to-date. XLY invests ~9.6% of its holdings in restaurant companies.
In this series, we’ll look at analysts’ estimates for Panera’s revenue, EBIT (earnings before interest and tax) margins, and EPS for the next four quarters. We’ll also look at its valuation multiple, recent analyst recommendations, and target prices for the next 12 months.
Let’s start by looking at analysts’ revenue estimates for the next four quarters.