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The 10 Fastest-Growing Fast Food Companies

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Ahead of end-of-the-day earnings for some, a list of fast food makers currently cooking up healthy revenue.

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MINYANVILLE ORIGINAL Minyanville takes a look at the fast food industry's 10 fastest-growing companies in terms of market cap growth over the past 12 months. A great deal of help came from Lynne Collier, a Managing Director of Restaurant Research at Sterne Agee. Collier, who was ranked third in restaurant stock picking in 2007 by Forbes, shared her analysis and outlook on a number of the companies mentioned below.

Carrols Restaurant Group

Leading this list, Carrols Restarant Group (NASDAQ:TAST) has seen its market cap swell 38% over the past 12 months to $142 million.

On May 7, Carrols spun off its Fiesta Restaurant Group (NASDAQ:FRGI) division via a tax-free dividend of common stock to Carrols' shareholders, issuing one share of Fiesta stock for every share of Carrols stock held at the market's close on April 26, as reported by Reuters.

Fiesta's 91 Pollo Tropical locations and 158 Taco Cabana locations capitalize on the Hispanic and Caribbean food market, offering authentic ethnic foods at locations in the Southern US, the Caribbean, and Central and South America. Fiesta's stock traded into the $17 range through the summer, until falling back down to levels closer to the $12-per-share price it traded following the Carrols spin-off.

Carrols' stock dropped from just above $15 to below $5 as result of the spin-off, and has remained in the $5-$6 range ever since, recently pushing toward mid-$6 range.

What has Carrols been left with after the split? 576 Burger King (NYSE:BKC) franchises, 278 of which Carrols acquired in May. Carrols is the largest Burger King franchisee in the world, according to Nation's Restaurant News. Burger King received $16.8 million in cash in the deal as well as 28.9% equity interest in Carrols.

To fund this acquisition, Carrols not only completed an offering of $150 million in 11.25% senior secured second lien notes, but also entered into a $20 million revolving senior credit facility, according to NRN. The substantial amount of cash left over after the purchase will be used to remodel 450 Burger King locations and refinance existing debts.

Recently, Zack's Investment Research named Carrols, along with Denny's (NASDAQ:DENN), as currently looking to enter the rapidly-growing Indian marketplace.

Chuy's Holdings

Since incorporating in 2006, Chuy's Holdings' (NASDAQ:CHUY) Tex-Mex fast-casual concept has expanded into 37 full-service restaurants throughout Texas, Tennessee, Kentucky, Georgia, Alabama, Florida, and Indiana. Its market cap has growth 32% over the past year to $384 million.

In July, the Austin-based purveyor of "Chicka-Chicka Boom-Boom Chicken," "Texas Martinis," and signature sauces like "Deluxe Tomatillo," had a more-than-successful IPO, selling over 5.8 million shares at the top of the $11 to $13 range. A steady increase into early October saw the stock nearly triple, before pulling back over the past week.
Analyst quoted for this article may have positions in some of the stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
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