Trade Insider
by trader on April 28, 2015

Burger King Worldwide Inc. (NYSE:BKW) Sales rose 6.9 percent at established locations in the U.S. and Canada

(AP)Burger King Worldwide Inc. (NYSE:BKW) sales rose 6.9 percent at established locations in the U.S. and Canada, parent company Restaurant Brands International said. The company, which also owns Tim Hortons doughnut chain, declined to say whether the increase at Burger King was driven by higher average spending or an uptick in customer traffic, which is a key indicator of health.

Restaurant Brands International CEO Daniel Schwartz said in an interview there was no single factor that drove the improved sales in the U.S. Instead, he cited a variety of factors including a spicy BLT Whopper, marketing during the NCAA championships and healthy sales at breakfast.

We said it in the past — theres no silver bullet, he said.

The showing comes as rival McDonalds has been fighting to hold onto customers, with sales at established locations falling 2.6 percent during the first three months of the year. Taco Bell, which is benefiting from the launch of a national breakfast menu, saw sales rise 6 percent during the period, according to parent company Yum Brands Inc.

On a global basis, same-store sales rose 4.6 percent at Burger King and 5.3 percent at Tim Hortons.

For the quarter, Restaurant Brands International Inc. reported adjusted earnings that beat analysts expectations.

The Canadian company, which was formed in December through a combination of Tim Hortons Inc. and Burger King, reported a loss of $8.1 million, or 4 cents per share. But it had earnings of 18 cents per share after adjusting for certain costs.

Analysts polled by FactSet expected profit of 15 cents per share.

Revenue rose slightly to $932 million. Analysts polled by FactSet expected $944.7 million.

The results were subdued by a strong U.S. dollar and the company said it would have seen 9.6 percent growth without currency swings.

Shares of Restaurant Brands were up 3.6 percent at $43.07.

Burger King Equity Analysis

Burger King Worldwide Inc. (NYSE:BKW) opened trading today as $35.50 and is trading in the range of 34.87-37.41 today. Burger King’s current market cap stands at $14.63 billion.

Compared to other peers in the Restaurants sector, Burger King’s earnings per share is currently at .49, which is higher then the sector average of 0.34.

Burger King mean target price is $35.25 according to First Call. This presents a solid downside to the current price of the equity. The Mean Recommendation sits at 2.1.

The most recent analyst actions consisted of RBC Capital Mkts upgrading the stock on December 10th and UBS initiating coverage with an initiation rating back in January.

The current quarter EPS revenue estimates of 275.07M. Sales are expected to grow at a 3.70% rate. Burger King reported actual earnings last quarter of 0.27 which equals the .27 consensus estimate, a 0.00% surprise.

Corporate Profile

Burger King Worldwide, Inc. franchises and operates fast food hamburger restaurants, under the Burger King brand. The Company generates revenues from three sources: franchise revenues, consisting primarily of royalties based on a percentage of sales reported by franchise restaurants and fees paid by franchisees; property income from properties that it leases or subleases to franchisees, and retail sales at Company restaurants. As of September 30, 2014, it owned or franchised a total of 13,960 restaurants in approximately 100 countries and United States territories. The Company’s franchises own 13,908 and the Company owns 52 restaurants.

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