Zacks Investment Research downgraded shares of The Wendy's Co. (WEN) from OUTPERFORM to NEUTRAL on September 30, 2013, with a target price of $9.00.
We are reverting to a Neutral recommendation on Wendy's from Outperform. While Wendy's second-quarter 2013 adjusted earnings grew year over year mainly through effective cost control measures, sales scenario remained sluggish missing the Zacks Consensus Estimate and grew just 0.7% year over year. The improvement in comps was also soft. Further, we believe, the positive impact of multi-year turnaround plan, international expansion, extensive refurbishment of units, focus on franchising and dividend hike are reflected at the current level and there is little room for further upside. Although Wendy's repositioning efforts seem to be on track, the turnaround process still needs time before it fully pays off. Moreover, an uncertain economy, faltering consumer confidence as well as heightened competition remain causes of concern.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
To get a free copy of the research report on The Wendy's Co. (WEN),
click here.
For more information about research offerings from Zacks Investment Research, visit
Zacks.com .
Be the first to comment