By Mark Kalinowski
Published on May 9, 2019 at 12:00 AM
Earlier today (Thursday, May 9th), we learned that the BlackBox Index of same-store sales for April 2019 declined by -0.4%, with same-store traffic down by -3.5%. The -0.4% showing for April 2019 marks the second-worst showing of the last 12 months, and marks meaningful sequential deceleration from the +1.2% figure attained in March 2019.
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By Mark Kalinowski
Published on March 7, 2019 at 12:00 AM
Earlier today (Thursday, March 7th), we learned that the BlackBox Index of samestore sales for February 2019 declined by -0.6%, with same-store traffic down by -3.7%. The -0.6% showing for February 2019 marks meaningful sequential deceleration from the +2.0% number from January 2019 and the +2.0% figure from December 2018, which had been the best monthly numbers since August 2015. February was hampered to a large degree by weather (although we’d note January experienced some bad weather too, and January clearly seemed to shrug off that issue much more easily), particularly on the east coast and in the midwest. (February 2019 same-store sales were positive in California, the southeast, and the southwest.)
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By Mark Kalinowski
Published on February 5, 2019 at 12:00 AM
We downgrade the shares of Papa John’s (PZZA) to Neutral (from Buy). Our ratings change reflects the following: (1) our original upgrade to Buy reflected the possibility of Papa John’s being acquired; that possibility seems resolved with it unlikely to happen (albeit with the silver lining of yesterday’s news of Starboard’s $200 million strategic investment, which helped the shares up by about +9% yesterday), (2) our view that the business was getting “less bad” in Q4 and likely to show further improvement in early 2019, which is undercut by the news yesterday that North American systemwide same-store sales declined by -8.1% in Q4 2018 and by -10.5% in January 2019 (technically, December 31, 2018 through January 31, 2019), (3) our evolving view on the likelihood of meaningful refranchising, which we cannot rule out in the long run — but which appears to be getting less likely in the short- and medium-term given the recent business results, and (4) PZZA shares’ +5.4% year-todate performance even in the face of poor fundamentals — sometimes it’s best to take a gain when a gain can be had, even if it’s not what we had hoped for when we originally upgraded PZZA to Buy. We note the following:
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