KFDA - NewsChannel 10 / Amarillo News, Weather, SportsPanera Bread up on upbeat outlook for 2010 profit
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SAN FRANCISCO (AP) - Shares of Panera Bread Co. rose Wednesday after the company set its 2010 profit forecast higher than Wall Street estimates and it beat third-quarter expectations.
The St. Louis chain of bakery-cafes reported late Tuesday that third-quarter profit of 61 cents per share beat a 58 cent per share consensus estimate of analysts polled by Thomson Reuters.
Shares jumped $4.67, or 8.5 percent, to $59.77 in afternoon trading.
Recession-weary consumers have shifted from higher-priced restaurants meals to cheaper alternatives like Panera, which sells sandwiches, soups and other snacks. The chain also raised its prices, further boosting its sales results.
Panera said it expects 2010 profit of $3.05 to $3.15 per share on a sales increase of 3 percent to 5 percent at company-run bakery cafes open at least a year. Analysts forecast 2010 profit of $3.06 per share.
Morgan Keegan analyst Robert Derrington said the company's sales at stores open at least a year were better than projected. He raised the firm's forecast for fourth-quarter earnings per share by 2 cents to 87 cents, fiscal 2009 profit by 5 cents to $2.69 and fiscal 2010 profit by 8 cents to $3.13.
Analysts expect fourth-quarter profit of 86 cents per share and 2009 profit of $2.65 per share.
Derrington said lower commodity prices should also help Panera. He kept an "Outperform" rating on the stock.
Deutsche Bank analyst Jason West said investors would boost the stock based on the "solid top and bottom-line result in 3Q and positive outlook."
Panera and its franchisees operated 1,362 bakery-cafes by the end of the quarter.
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