Shares of The Steak n Shake Company (NYSE: SNS) are up about 5% today on an analyst report that hedge fund manager turned shareholder activist turned Steak n' Shake CEO Sardar Biglari is "making quick strides" toward a turnaround at the company.

Biglari became chairman of the company back in June after a proxy contest that kicked out a regime that had underperformed for years, and became CEO earlier this month after the board spent a few months looking to bring someone in from the outside.

Biglari certainly qualifies as investor-friendly but he looks like could be overexposed in a role that involves turning around a restaurant chain. He's currently CEO of the much smaller Western Sizzlin Corporation (NASDAQ: WEST) chain, but his prior experience in the restaurant industry is pretty much limited to an investment in Friendly's that culminated in a sale to a private equity firm at a price that, in retrospect, appears to have been too high.

When most companies report bad numbers in a tough economy, they're quick to blame their woes on the macro picture.

This bothers me because it's pretty hypocritical: I have never once seen a company report good numbers in a good economy and tell investors in the press release that 'We're getting bailed out by the economy right now. We haven't made good strategic decisions, but hey, in a market like this, Richard Wagoner could make money! I can't believe how much we get paid for this!'

But when Steak n' Shake (NYSE: SNS) reported a loss of $9.8 million for the third quarter vs. break-even last year, the company's newly-installed CEO Sardar Biglari didn't blame high gas prices and low consumer confidence. Here's his statement from the press release:

In my view, our poor performance is not the result of poor economic conditions. Much of our operating shortfall, I believe, is the result of our own lack of execution. As a company that began in the midst of the Great Depression, we have a deep heritage from one of the great American brands and are fortunate to have attracted committed and passionate employees, benefits that we believe will allow us once again to become a thriving chain.

The ranks of discontented Applebee's International Inc. (NYSE: APPB) shareholders have been on the rise since the company announced that it would be acquired by IHOP (NYSE: IHP) in July. My first reaction was, If IHOP wants it, should Applebee's sell it? The deal gave Applebee's shareholders a paltry premium and shares of IHOP soared on news of the deal -- further confirmation that this was better news for IHOP shareholders than for Applebee's. In acquisitions, generally it's the opposite.

Then shareholder Sardar Biglari announced his opposition to the deal and Applebee's disclosed that five of its directors including its Chairman, CEO, and CFO opposed the deal.

Now Applebee's has settled a shareholder class-action lawsuit filed by the New Jersey Building Laborers Pension and Annuity Funds alleging that the merger agreement deprived Applebee's shareholders of the benefits they might have gotten if the casual restaurant chain had stayed independent or sold off its company-owned locations to franchisees, the Associated Press said. No money will exchange hands in the settlement. Applebee's has simply agreed to provide shareholders with greater disclosure about IHOP's post-deal plans for Applebee's.

Shares of Applebee's aren't acting as if traders expect the deal to be blocked or the price raised, but if either of those two things happens, shareholders should do quite well. Buying a few shares here looks like an interesting gamble, with a chance for profit if the anti-IHOP deal movement gains steam.

Whenever an activist makes a 13D filing in a company, I'm interested. When an activist goes further and presses for change or board seats via a 13D or 13D/A filing, I become even more interested. And when an activist goes to the next level and creates a website to promote their message and cause, I need to research the idea. One such idea is Friendly's (AMEX:FRN), a company held by value investor Sardar Biglari of the Lion Fund. I highly recommend interested readers visit the activist's website and read all the letters and articles I reference throughout this article before making any investment decisions.

Biglari and his investment funds own about 15% of Friendly's. He is seeking to get himself and Philip Cooley elected onto the company's board. One of Biglari's most interesting letters to shareholders was written on Tuesday (3/6). Throughout the four page letter he highlights his core beliefs regarding Friendly's.

First off, Mr. Biglari took apart the company's argument that he and Mr. Cooley are looking to "control the board" quite easily by pointing out the quite obvious fact that two-sixths does not represent a majority and, therefore, control would not be had with their election. He also went on to point out the fact that Friendly's "in aggregate, has generated negative cash flows...Phil and I will strenuously lobby the board to focus on cash flows to increase the intrinsic value of the company. If we can increase intrinsic value per share, the stock price will eventually follow suit."

Then Biglari discussed the company's capital structure -- mainly the company's debt-heavy balance sheet. The obvious risk of this capital structure is that any small problem with the business could cause the company to return to "near insolvency." Biglari goes on to say that "I believe the company will become bankrupt if it does not attempt to delever the balance sheet." He even pledges that he and Mr. Cooley will "champion a disciplined financial structure to increase shareholder wealth."

Also, Biglari believes the company should shift its strategy by decreasing the number of company-owned and operated units allowing it to "distribute more of its resources to the creation of better products, better quality control, shrewder, more effective marketing practices, more effective franchisee training - all with the objective of becoming a forceful franchiser capable of efficiently enhancing the brand." He also points to the irrefutable fact that returns on capital are higher from franchising than from ownership. He believes that the company could use the money from selling company-owned units to franchisers (re-franchising) to pay off the debt-load.