Bob Evans Farms, Inc. (NASDAQ:BOBE)

CAPS Rating: 3 out of 5

A full-service restaurant company that operates two distinct restaurant concepts, Bob Evans Restaurants and Mimi's Cafes. It is also a producer and distributor of pork sausage and complementary, homestyle, convenience food items.

Recs

3
Player Avatar kristm (99.75) Submitted: 6/12/2008 12:02:58 PM : Underperform Start Price: $33.26 BOBE Score: +15.71

The recent spike is due to higher-than-expected Q4 earnings - most of which can be attributed to sales of real estate, not increased sales or more efficiency in the core chain. They're predicting better sales during 2009, but with the economy contracting and hurting like it is I would be surprised to see even flat sales. People don't have as much money to spend on eating out and probably won't for another year or more. Every restaurant is getting beaten up for the same reason.And every extra sale they have will begin to cost more - in case you haven't noticed food prices in every category are rising like mad. Bread, fruit, cooking oil... Pork, poultry, and beef are shooting up because of the increasing costs of buying corn-based animal feed. What's BobE's main business besides restaurant operator? Meat processor. Those sausages are costing them more and more to produce.And my original underperform argument still stands - they have a lot of stores but the menu is BORING! Snore-worthy! Boring is OK if you're buying a manufacturer, but in the restaurant space you need something more appealing and buzz-worthy on your menu than anything Bob E is offering. And they don't have much of a cult following, either. If the company disappeared tomorrow would anybody notice?

Member Avatar Tastylunch (29.37) Submitted: 6/16/2008 9:52:15 PM
Recs: 0

I would notice, I eat there all the time. I really like the food actually. The Biscuits and sausage are killer good. You're right though the Bob ain't too flashy.

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