Brinker International (EAT)

(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.

US restaurant company with over 1500 stores with the vast majority being Chili’s. Balance sheet problems in 2008 have been fixed and they are now investment grade. Same-store sales was very weak coming out of the financial crisis but have turned positive in the last 6 quarters. A $2.5 billion company and they just gave guidance that they are going to buy back $1 billion of stock and going to pay $300 million in dividends. You’ll get half your money back between now and 2017 and you’ll own more of the business than you do today. Dividend yield of 2.19%.

Main restaurant is Chili's in the US. Have done some good things in turning things around and getting margins up. In the restaurant business you are better to find newer concepts with potential future store growth. Restaurants are going to be pressured over the next few years by rising food and commodity costs. Trades at a steep multiple of 15-16 times earnings.