Goldman Upgrades Panera Bread, Downgrades Shake Shack, Dunkin' Brands

Goldman Sachs on Thursday changed ratings on three fast-food/fast-casual stocks to reflect improving economic data and stragetic and structural changes at individual companies. Analysts upgraded Panera Bread Co. to neutral from sell, and downgraded Shake Shack Inc. to sell from neutral and Dunkin' Brands Group Inc. to neutral from buy. "While we still have longer-term concerns regarding competitive intrusion and the rollout of PNRA 2.0, we are incrementally more positive on the near-term comp outlook following analysis of PNRA's recently launched national advertising campaign," they wrote in a note. In Shake Shack's case, the downgrade reflects expectations that a positive long-term view is already priced in, as well as the potential for selling pressure once the lockup period expires on July 29. Dunkin's downgrade reflects the view that the stock is trading towards peak levels on an embedded value/EBITDA basis. Only Shake Shack shares were active in premarket trade, up about 0.6%.