Raymond James upgraded Rare Hospitality (RARE ) to buy from hold.
Analyst Bryan Elliott says his upgrade is based on his higher 2004 earnings per share estimates ($1.42, up from $1.39), and the increased likelihood that the Canadian border would reopen in early 2004. Last Friday, the Federal Office of Management & Budget authorized the U.S. Agriculture Department to issue rules allowing the resumption of imports of Canadian cattle younger than 30 months of age. He notes the rules are subject to a 60-day comment period.
Elliott expects the Canadian border to effectively reopen early in the first quarter of 2004. This expectation means that beef costs for casual dining chains should normalize in the second-half of 2004 or earlier. He has a $30 target for this restaurant operator, which owns LongHorn Steakhouse, Bugaboo Creek Steak House and The Capital Grille.