Wedbush Morgan Keeps 'Buy' on Applebee's

Analyst Adam Holiber says stronger-than-expected January restaurant sales signals solid fundamentals for the casual dining sector

Wedbush Morgan reiterated its buy rating on Applebee's (APPB ).

Analyst Adam Holiber says January comparison sales are better than expected. He says he's especially impressed given the negative impact of the Super Bowl shift into January this year from February last year. He also cites colder, wetter weather vs. a year ago.

Holiber says sales results provide another signal that casual dining fundamentals remain solid. He notes Applebee's strong performance implies good momentum for its To Go initiative, a factor he believes will be a strong growth driver over the next three to five years. Holiber sees $1.06 2003 earnings per share on $370 million in revenue. He's keeping his $32 target.

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