Enodis has a strong global footprint, assembling a large portfolio of quality brands, such as Delfield, Frymaster, Garland, Ice-o-matic, Scotsman and so on. What's more, the company has top-notch clients like Burger King (NYSE: BKC) and McDonald's (NYSE: MCD).
However, on its face, Enodis looks like a mature company, with little growth ahead of it. But the fact remains that the company is poised nicely for opportunities in emerging markets, especially in Asia.
Even so, Manitowoc is certainly paying a premium for Enodis. Perhaps that's why Wall Street is a bit concerned, as Manitowoc's stock has gone from $44.75 to $30.83 since April.
Burger King (Burger King Holdings, NYSE:BRC) has made good headway recently by constructing sandwiches large enough to bring down a New York crane and marketing tied to video games and hot movies. Therefore, it would have been the last company I would expect to unveil a $190 hamburger.
Actually, the burgers aren't widely available, yet- only in one location, in West London, and only once a week, by reservation. I suppose the burger, Wagyu beef piled high with white truffles, Pata Negra ham, white wine/shallot mayo, Himalayan rock salt and a soupçon of Iranian saffron. The combo includes Cristal champagne onion straws, a limited edition bottle of Coke, and Cabernet Shiraz wine from Australia .
Emma Hall, who reported on the experience for Ad Age, found the meat 'not perfect', due to the health code's requirement that it be cooked to 165 degrees, but liked the mayo, ham and truffles. Other diners she interviewed were pleased, but mostly not $190 worth of pleased. Personally, for $190 I'd expect the King to detail my car while I ate.
This mother of all burgers was created as a PR stunt to help recast the BK brand as a higher-quality product, with proceeds benefiting a local charity. The company plans to expand the limited-time program to Spain and Germany. For now, I'll have to drown my longing in a Whopper, sans truffles, sans saffron, and Cristal-free fries.
Three types of raw tomatoes -- red plum, red Roma and round red tomatoes -- grown in 17 states are voluntarily being pulled of the shelves and menus of McDonald's (NYSE: MCD), Wal-Mart (NYSE: WMT), Burger King (NYSE: BKC), Kroger (NYSE: KR), Outback Steakhouse, Winn-Dixie (NYSE: WINN) and Taco Bell, among others. In fact, "McDonald's has stopped serving sliced tomatoes on its sandwiches as a precaution, but will continue serving grape tomatoes in its salads because no problems have been linked to that variety."
Similarly, Burger King, Yum Brands Inc. (NYSE: YUM) restaurants, Darden Restaurants (NYSE: DRI), and Chipotle Mexican Grill Inc. (NYSE: CMG) have also removed the contaminated brands from their menus across the U.S., and some, like Burger King, in Canada, Puerto Rico and some other Caribbean islands as well. Many left the non-contaminated brands on the menu.
I always love news items like this. According to Reuters, there exists a $175 hamburger. You can find it in New York at a place called The Wall Street Burger Shoppe. Presumably, big traders would be the only ones able to afford it.
Well, for those who would even think to complain about the prices at McDonald's (NYSE: MCD), Burger King (NYSE: BKC) and Wendy's (NYSE: WEN), this $175 burger should put things in perspective. It doesn't sell a lot; the news piece states that the place moves about two dozen in any given thirty-day period. The Wall Street Burger Shoppe mostly sells $4 burgers.
But, really, this $175 burger is nothing more than genius marketing. The owners are obviously not under any illusion whatsoever that they can make a great return on capital by investing in such a pricey offering. All it's meant to do is to bring publicity to the establishment. It's obviously worked. As a way of branding, this goofy pricing scheme immediately differentiates the restaurant's brand from others. In fact, it was the stated intent of the owners to have the most expensive burger in the area. It's also a great differentiator between personalities. I mean, I think you can tell a lot about a person who is actually willing to buy this thing (and, you can certainly infer a lot about the person's net worth).
MOST NOTEWORTHY: Edison International, Animal Health International and SanDisk were today's noteworthy initiations:
RBC Capital initiated Edison International (NYSE: EIX) with an Outperform rating and $64 target citing strong rate base growth and the favorable environment at Southern California Edison.
Piper assumed coverage of Animal Health International (NASDAQ: AHII) with a Buy rating and $10 target, as they believe the current valuation is attractive from long-term investors.
Pacific Crest started SanDisk (NASDAQ: SNDK) with a Sector Perform rating and believes the valuation is too high following the recent strength as product margins are trending down.
OTHER INITIATIONS:
Sandler initiated Heritage Commerce (NASDAQ: HTBK) with a Hold rating and $16 target.
Burger King (NYSE: BKC) was initiated with a Buy rating and $34 target at Piper.
RBC Capital assumed U.S. Geothermal (AMEX: HTM) with an Outperform rating and $4 target.
MOST NOTEWORTHY: Lincoln Educational, Sonus Networks and Novartis were today's noteworthy upgrades:
Lehman upgraded Lincoln Educational (NASDAQ: LINC) to Overweight from Equal Weight based on improving student enrollment growth and valuation.
Merriman upgraded Sonus Networks (NASDAQ: SONS) to Buy from Neutral on the company's strong AT&T (NYSE: T) outlook and near-term upside potential from Japan. They believe shares can trade towards the $5-$6 range.
Bernstein raised Novartis (NYSE: NVS) to Outperform from Market Perform as they believe the company's diversification position it well to withstand future generic expiries.
OTHER UPGRADES:
Goldman Sachs added Burger King (NYSE: BKC) to its Conviction Buy List.
Credit Suisse upgraded Imperial Tobacco (NYSE: ITY) to Outperform from Neutral.
McDonald's (NYSE: MCD) announced its same-store sales results for the month of April Thursday, and the data indicate a healthy fast-food business ("healthy fast food" -- isn't that an oxymoron?).
Global comps as a whole increased 5%. Comps for European locations increased 6.3%, and the Asia/Pacific/Middle East/Africa segment saw a 7.8% rise in same-store sales. McDonald's restaurants in the States increased an anemic 2%. The weak domestic sales really need to be addressed so that they can pull more weight and add to the cool story that is McDonald's.
The stock has been a pretty decent performer over the last several months, rising over 6% over the three-month timeframe, and over the one-month period, it is up over 7%. And the longer-period returns from the past are even more impressive. Imagine how McDonald's stock would perform if management figured out how to get people to visit the U.S.'s Golden Arches more often. I suppose April's performance should be praised since March saw a decline in U.S. comps, as this article makes plain, but that depreciation was the first one in five years, and that says to me that McDonald's needs to be careful.
It's all about the marketing, of course. There are a lot of choices out there -- Burger King (NYSE: BKC), Wendy's (NYSE: WEN) and Yum! Brands (NYSE: YUM) -- so I think promotion of the brand is key. Some will disagree and say that menus and pricing are the big drivers -- they are important, don't get me wrong, but perhaps McDonald's needs to take a cue from Burger King and its campaign with the creepy-king thing -- those commercials are clever. Still, if this comps reports says anything, it says that you shouldn't count the clown out -- McDonald's is a blue-chip stock that is near a 52-week high, and not only is it a great long-term/core holding, but it's also quite possibly an interesting shorter-term idea as well.
Disclosure: I don't own shares in any company mentioned here; positions can change at any time.
Burger King Holdings (NYSE: BKC) shares are falling after the company announced private-equity companies will offer 15 million shares of its stock. The selling stockholders currently own 58 million shares, representing 43% of outstanding shares, so this 15M share offering represents another 11% of the company and the extra supply should keep BKC's price lower for a period. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on BKC.
After hitting a one-year high of $29.19 in December, the stock hit a one-year low of $21.60 in January. This morning, BKC opened at $27.36. So far today the stock has hit a low of $27.35 and a high of $27.94. As of 12:30, BKC is trading at $27.73, down $0.73 (-2.6%). The chart for BKC looks bullish but deteriorating, while S&P gives the stock a positive 4 STARS (out of 5) buy rating.
For a bearish hedged play on this stock, I would consider a June bear-call credit spread above the $30 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 7.5% return in six and a half weeks as long as BKC is below $30 at June expiration. Burger King would have to rise by more than 8% before we would start to lose money. Learn more about this type of trade here.
This post is part of our Battle of the Brands feature. Let us know which brand you prefer, and check out other Battle of the Brands posts.
In this corner, the clown. After years of taking shots to the stomach, McDonald's (NYSE: MCD) was thought to be on the ropes, but has found new life in tightened operations, successful product launches, and a new aggressiveness. It's currently in training to take on the coffee-weight champ, Starbucks (NASDAQ: SBUX), in a no-holds-barred battle of the baristas.
In the other corner, the King. Burger King (NYSE: BKC), the burger chain with the creepiest ad campaign on television (what's with the young dude waking up to find the King in bed with him?) has thrived on a two-pronged approach; over-the-top menu items and movie/game tie-ins. BK hit the breakfast market hard with its enormous omelet sandwich, packing a wallop of 730 calories. Its Xbox game tie-in, a cheap game featuring the King was an enormous success, setting a trend that has been widely adopted.
Both chains are thriving as the third of the troika, Wendy's, continues to punch beneath its weight. With a three-year growth of almost 100% in its stock price, though, this bout clearing goes to the clown, on points.
Vote in our poll for McDonald's or Burger King as your preferred brand, and let us know in the comments why you love it.
McDonald's (NYSE: MCD) may be the big brand name in the fast-food industry, but don't discount Burger King (NYSE: BKC). The King reported its fiscal Q3 numbers on Thursday, and they were pretty regal indeed.
Revenues increased 10%, and earnings per share did even better, rising 20% to 30 cents (that beat earnings by three pennies, says Briefing.com). Now, when talking about retail stores and fast-food joints, the issue of same-store sales always comes up, since it's such an important element to consider (be sure to keep in mind that comps must always be put in an overall context, especially if you are only measuring a one-month timeframe). Global comps increased 5.8% for the quarter, a good showing for Burger King which wants to become a force to be reckoned with around the world. The domestic side of things isn't doing too badly either as comps in the United States and Canada moved up 5.4%. Restaurant margins, however, decreased due to the challenging commodity-cost environment we all live in nowadays. Otherwise, I see these earnings as very positive for Burger King, and I am bullish on the stock.
Wendy's (NYSE: WEN) finally sold the company to Nelson Peltz. The price which Peltz company Triarc paid was about $26.78 per share only a 6% premium according to the AP. One of the reasons the firm went for so little may be that there were no other buyers. The Wall Street Journal writes that "The move puts an end to the year-long saga that began when Wendy's first said it would consider a sale last April after Mr. Peltz began pressuring the chain."
Peltz has gotten a very good deal and Wendy's shareholders have not. The chain's current stock price is near its 52-week low. Over the last six months, the company's shares are down about 23% while rivals Burger King (NYSE: BKC) and McDonald's (NYSE: MCD) are up about 5%. Of course, they are the market share leaders and deserve some premium for that.
But if fast food does well, especially in a poor economy when people cannot afford more expensive restaurants, Peltz will have picked up a prize. When a recovery comes around, Wendy's could become a very nice business and the billionaire will look like a genius.
Douglas A. McIntyre is an editor at 247wallst.com.
McDonald (NYSE: MCD) has issued a press release recently concerning the use of cellphone coupon marketing. The fast-food juggernaut wants its consumers to have the ability to snag a coupon whenever they desire and by hooking up with a company called Cellfire, McDonald's is hoping it can establish a relationship with some of the hip texters out there.
Cellphone users who download the Cellfire app can then text a certain number and receive a special code good for a specific offer. According to the release, McDonald's fans can take advantage of a free iced coffee promotion through April 27 in certain locations in Utah, Wyoming, and Nevada.
McDonald's knows we're an on-the-go society, and it obviously wants to leverage the fact that mobile devices are no longer just for talking -- we text, we play games, we surf the net, and, as I recently observed, we can even shop on Amazon on our cells (I say "we," but I should point out that I do not own a cell phone, believe it or not). However, as I stated in my previous post, I'm not so certain that Amazon's text-shopping service will take off.
I was in a fast-food frame of mind last night, so I thought I'd check out Wendy's (NYSE: WEN) same-store sales report from last week. For the first quarter, Wendy's average same-store sales at franchise locations in the United States were essentially flat, declining by a mere 0.1%. However, in the year-ago period, the performance was a lot better, as comps increased 3.7%. Average same-store sales at company locations declined 1.6%; this compares to an increase of 3.8% in last year's quarter.
The early Easter holiday and inclement weather were sourced as reasons for the poor performance. Hmmm...not so sure about that. Wendy's might have just dropped the ball this time around. Hey, it's not easy competing with Burger King (NYSE: BKC) and McDonald's (NYSE: MCD). As a matter of fact, in the case of Burger King, you have to admit that it does have a pretty edgy marketing campaign currently supporting its brand equity (I love the company's humorous commercials).
Comps aren't everything to a fast-food chain's story, but this lackluster performance doesn't compel me to open the URL to my broker and place an order for shares of the company. Complicating things is the fact that Wendy's has expressed its desire to sell itself to a buyer. This makes the situation speculative, to me at least. For now, I'll stay away from Wendy's as a potential investment idea, but I do continue to watch McDonald's -- I've been perpetually interested in owning that one, but haven't pulled the trigger yet. I will admit, however, that Wendy's burgers are pretty cool...
Disclosure: I don't own shares in any of the companies mentioned; positions can change at any time.
Burger King Holdings (NYSE: BKC) has been a strong performer since its 2006 IPO, but as McDonalds (NYSE: MCD) has invested aggressively in modernizing its restaurants, Burger King is feeling the pressure to keep up.
Solution: The Whopper Bar. According to the Wall Street Journal(subscription required), Burger King will begin opening a new line of stores this year under that name, offering a wider variety of burgers and a hipper, more Gen Y-oriented atmosphere.
The stores and menu will be smaller but company executives told the Journal that the stores will include "as many as ten types of Whoppers such as the Western Whopper, the Texas Double Whopper and the Angry Whopper, a version topped with spicy onions. One menu sketch has a section called "Pimp Your Whopper," where patrons can chose from additional toppings like jalapeno peppers, bacon and barbecue sauce."
The Journal was also told that the company could possibly serve alcohol at some locations.
I like this idea: The Whopper is an extremely strong brand, and putting on the marquee and building a hipper brand around it should work well. Assembling the burgers in view of customers should bolster the company's image (assuming it's done in a classy way), and may help the brand appeal to a more affluent demographic turned off by the stigma of "fast food." Hopefully they'll open one near me.
Enodis plc, which got its start in 1910, is a global supplier of food and beverage equipment. Actually, it's been a tasty company for several suitors.
Burger King (
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Here are some highlights from this past week's 
This post is part of our 
I was in a fast-food frame of mind last night, so I thought I'd check out 
Alcoa's Q2 2008 earnings transcript
Anheuser-Busch (BUD) sues InBev, what's next?
Wal-Mart might help your portfolio during the recession
