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ikkyu2 (99.46)

Wing and a prayer

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October 16, 2012 – Comments (3) | RELATED TICKERS: BWLD , DPZ

As most of you know, I'm bullish on BWLD long term because of future growth prospects - opening new locations is the main catalyst I'm looking at.

As most of you probably don't know - doubt I ever talked about it here - DPZ, Domino's, is probably hands down my best CAPS pick.  I picked it at 9, got out at 23, repicked it at 22 and it is now 40.  Had I not gotten out and repicked it'd be my highest scoring pick by a huge margin.

I was thinking about risks to the BWLD thesis.  There are a lot, as with any stock.  The one I had in mind was this:

 

Company derives 29% of its revenue from alcohol sales, yet demands that its franchises be on corners with heavy automobile traffic and sufficient space for parking.

Wouldn't a tort attorney have a field day with this? 

 What do you think, Fools?  What other risks to your favorite stocks can you foresee when you're making gloomy forecasts?

3 Comments – Post Your Own

#1) On October 16, 2012 at 11:16 PM, awallejr (79.94) wrote:

I don't consider it an "alcohol" play but a sports/entertainment play with a great food product.  I went to the University of Buffalo and the biggest thing we ate were chicken wings.  When I came back to NYC I really tried to get local eateries to make them.  I even gave them the recipe.  Nada, except some pizza parlor in Manhattan.  I met many a UB graduate there lol.

The issue has been input costs because of the drought not alcohol usage.

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#2) On October 17, 2012 at 4:25 PM, JaysRage (94.04) wrote:

Cross between a sports-bar and a middle-family-friendly restaurant. Popular bars are usually on well-traveled streets as well, so I don't see why BWLD is any more of a conflict of interest.   

Love the company....would like to see it come down a little bit in price in order to get in again (been in and out a few times)....have it lumped in the over-bought bucket right now....mostly on valuation.  

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#3) On October 17, 2012 at 4:29 PM, JaysRage (94.04) wrote:

Legal, logistical costs, commodities costs, price elasticity, brand, economic beta, competitors, key partners, political environment, taxes, regulations, environmental factors, weather, war, age demographics.    Every business has it's unique risks and it's industry risks.  

All need to be looked at.    

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