Sonic Corp., the drive-in burger chain, fell 10 percent after saying it will open fewer franchised restaurants this year than it had planned.
About 22 to 27 new franchised restaurants will be opened in the current quarter, the company said Monday in a statement. That would leave Sonic with a maximum of 47 new restaurant openings in its current year, missing its goal for 50 to 60 new franchises, executives said on a conference call Monday.
The shortfall is probably due to inclement weather, more remodels and relocations, as well as the challenges of “building the momentum of rekindling a unit development pipeline,” John Glass, an analyst at Morgan Stanley, said in a note. He has a neutral rating on the shares.
The stock declined to $30.71 at the close in New York trading, the biggest one-day drop since March 25. Before the tumble, shares of Oklahoma City-based Sonic had gained 26 percent this year.