Craig Millar Brinker International EAT-N TOP PICK Mar 26, 2013

(A Top Pick March 26/13. Up 12.49%.) Have roughly 1500 restaurants and all but 44 are under the Chili’s brand. This is primarily a capital return to shareholders story. Management intends to buy back $1 billion worth of stock between now and the end of 2017. 2.3% dividend yield.

(A Top Pick March 26/13. Up 38.5%.) They own 2 restaurant brands along with a whole bunch of restaurants, 1500 restaurants in total. All but 44 are under the Chillies’ brand.

1500 restaurants, Chili’s for example. There is pent up demand because good traffic has not caught up to 2007. You get a 2% dividend and 5-7% of stock bought back each year.

(Top Pick Jun 25/15, Down 18.16%) It was off in the last 6 months. Oil exposure hurt them because 17% of their restaurants (e.g. Chilli’s) are in Texas. They made a significant change to their loyalty program that hurt foot traffic. They are addressing it. 10% free cash flow yield, 8% share buyback and 2% dividends. He still likes it.

(Market Call Minute.)

Today, they reported a huge earnings beat as well as revenues and 9.1% same-store sales increase. Shares jumped 4%, but then during the conference call management mentioned higher costs and shares retreated a bit.

Reported Q1: revenues were inline but delivered a monster EPS beat of $0.28 vs. $0.06. Also, they raised their full-year forecast. Caused by adding more menu items and returning to national advertising after a hiatus.

Have reported several beats, including an earnings beat in late January and raised full-year sales and earnings forecasts. Trades at only 13x PE. Lots of room to run.

Shares have fallen from its peak in late June by 14%. Now is a good entry point even as peers step up their value offerings in the fast food space.

They just delivered great numbers: a monster top and bottom line beat, fueled by 31% same-store sales growth, surpassing all expectations. Shares leapt 16% today.