Raymond James hikes PTs for restaurants on likely post-pandemic recovery

Ruth's Hospitality

02/12/2020 14:12

** Raymond James raises PTs for several restaurant
operators, saying it would a buyer of their stocks on potential
coronavirus-driven pullbacks 
    ** Industry sales trends could begin to normalize through Q2
of 2021, with a stronger recovery in H2 on vaccine distribution
- brokerage
    ** Surviving restaurant chains will likely benefit from
reduced competition due to pandemic-driven closures, at least
temporarily - RJ
    ** RJ says its strong buy-rated stocks Bloomin' Brands
 BLMN.O , Dave & Buster  PLAY.O  and Ruth's  RUTH.O  trade at
significant discounts to their pre-pandemic enterprise
valuations
    ** RJ notes full-service restaurant stocks outperformed in
November on vaccine updates from Pfizer  PFE.N  and Moderna
 MRNA.O  even as U.S. was posting sharp increases in new cases
    
    Name        RIC       RJ's old     New PT    Upside to
                             PT                  last close
  Bloomin'     BLMN.O       $21         $22        23.3%
   Brands                                        
   Chuy's      CHUY.O       $25         $27        11.7%
  Holdings                                       
   Darden      DRI.N        $115        $120        8.6%
 Restaurant                                      
     s                                           
   Fiesta      FRGI.O      $13.50       $14        13.9%
 Restaurant                                      
   Group                                         
   Ruth's      RUTH.O       $16         $20         22%
 Hospitalit                                      
  y Group                                        
   Texas       TXRH.O       $82         $88        14.4%
 Roadhouse                                       
 

 (Reporting by Praveen Paramasivam in Bengaluru)
 ((Praveen.Paramasivam@thomsonreuters.com))