Craig Millar Brinker International EAT-N PAST TOP PICK Jun 03, 2014

(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.

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.