Banc of America Pares Applebee's Rating

Analyst Andrew Barish downgraded the restaurant operator based on recent price action in its shares

Banc of America downgraded Applebee's (APPB ) to buy from strong buy.

Analyst Andrew Barish says the downgrade is based solely on stock price action. He says he still recommends the purchase but the stock is just 5% below his original $45 target, calling for a less aggressive stance. However, he raised the target to $50. Barish says the company reported a strong Q1. He still believes new menu initiatives, new advertising and other operating/financial initiatives will drive accelerating same-store sales and EPS gains through 2001. He raisted his $2.73 2001 EPS estimate to $2.78 and sees $3.15 EPS for 2002.

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