Barclays Maintains an 'Overweight' on Buffalo Wild Wings (BWLD); 3Q11 (& October) Comp Upside Mitigates Margin Pressure... Bullish on 20% EPS in '12

Barclays maintains an 'Overweight' on Buffalo Wild Wings, Inc. (NASDAQ: BWLD) price target of $70.00.

Barclays analyst says, "BWLD underperformed heading into 3Q11 EPS on concerns of slowing comps, rising food costs, 2012 guidance & ramifications from an NBA lockout. We believe concerns were eased on three of four, with the outlier de-leverage on food costs. Comps accelerated to the current 8%+, 2012 guidance for 20% EPS growth seems achievable, and we think the NBA should have little impact. Food cost deleverage was experienced sooner than planned, leading us to lower estimates, less from elevated wing prices and more from a shift to value promos. While a valid concern into 2012, we expect pricing should mitigate."

"We continue to believe BWLD differentiated in an otherwise crowded bar & grill
segment, yet valuation has diverged relative to high-growth peers. We expect
low-double-digit unit and low-single-digit-comp growth (with near-term upside) to
overshadow industry food cost concerns, supporting 18%+ long-term EPS growth.
The shares are at 20.5x forward vs. the 11-27x three year range and 20.5x average,
and a modest ~1.1x PEG."

For more ratings news on Buffalo Wild Wings, Inc. click here and for the rating history of Buffalo Wild Wings, Inc. click here.

Shares of Buffalo Wild Wings, Inc. closed at $58.04 yesterday.

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