Einstein Noah Restaurant Group (BAGL)

[ScovilleUnits]

The Trader - Barron's Online

http://online.barrons.com/article/SB120855843505127605.html?page=3


MONDAY, APRIL 21, 2008
THE TRADER

A Sharp Rally Deposits
Dow Near Its '08 High
By KOPIN TAN

(Page 3 of 3 )

PRICIER INGREDIENTS AND FEWER diners also worry the Einstein Noah (BAGL) chain, but should its shares have fallen 62% in six months? Cowen analyst Paul Westra calls the slump "perplexing." Wheat costs have pulled back and recent government data show the most acreage planted in 11 years. Westra also isn't too worried about Einstein's refinancing of certain preferred shares due in June 2009. Meanwhile, has anyone checked out the new menu?

At 9.49, shares trade at just 8.6 times 2008 earnings, compared with 18 times for restaurants. With most chains now battling it out on price at lunch, breakfast has become the most important -- and profitable -- meal of the day, and Einstein rakes in 60% of its sales before noon.