What:Shares of fast-food chicken chainBojangles Inc. were looking hot out of the fryer today, jumping 23.6% on an impressive earnings report.
So what:Bojangles posted a per-share profit of $0.22 per share, topping analyst expectations of $0.19, while revenue increased 9.6% to $128.8 million, edging the Street's view of $127.7 million. Comparable sales increased only 0.6% with traffic actually decreasing, but that was better than some had feared as the Carolina-focused chicken-and-biscuits chain was able to fend off the launch of McDonald's all-day breakfast.
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It was the 23rd straight quarter of comparable sales growth, and CEO Clifton Rutledge pointed out that the company did it in spite of significant competitor discounting and catastrophic flooding in the Carolinas. The chain was also lapping a quarter in which comparable sales grew 7.1%.
Now what:For 2016, Bojangles guided toward EPS of $0.86-$0.90, in line with expectations and just modestly above the $0.83 profit per share it delivered in 2015. The company also expects to increase its store base by about 8%, and grow same-store sales in the low single digits.
While Bojangles shares are roaring today, the stock is still down substantially since its post-IPO peak last summer, falling by about a third in that time. With only modest same-store sales and EPS growth expected, shares seem fully valued after today's jump. Despite management's optimism, I wouldn't expect another pop like this anytime soon.
The article Why Shares of Bojangles Inc. Popped Today originally appeared on Fool.com.
Jeremy Bowman has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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