Chipotle Mexican Grill, Inc. (CMG), Buffalo Wild Wings (BWLD), And The Top Value Plays In This Space

Some companies are such obvious values that I have a hard time buying the shares. I’m unfortunately part of a club of non-investors in a concept I should have bought a long time ago…Panera Bread Co (NASDAQ:PNRA). Actually it’s even worse than that, I owned Panera Bread Co (NASDAQ:PNRA) at one point. In fact, I bought shares when they were about $50. When the stock rose to around $75, I sold because it looked like their forward P/E ratio was getting a little high. I can’t tell you how many times I’ve regretted that sell order. That being said, I hope to help investors learn from my mistake, and I can give you four reasons to consider buying shares today.

A Cult-Like Following
I’m constantly amazed at the strength of the Panera Bread Co (NASDAQ:PNRA). In fact, the only restaurant that I’ve seen such a huge following for is Chipotle Mexican Grill, Inc. (NYSE:CMG). Both of these companies are rapidly expanding, expected to grow earnings by more than 19% in the next few years, and both have crazy customers.

I don’t mean crazy in the sense that they don’t know what they are doing, I mean crazy in the sense that lines in these stores are what I can only call epic. Panera and Chipotle Mexican Grill, Inc. (NYSE:CMG) are both located in my local strip-mall, and they are constantly busy. If you walk into either restaurant around lunch or dinner, be prepared for a line. What’s amazing about both concepts is, they have a long line of customers, but they each are efficient at getting customers food ready in a relatively short amount of time.

Two other companies I link to Panera Bread Co (NASDAQ:PNRA) are Buffalo Wild Wings (NASDAQ:BWLD) and Starbucks Corporation (NASDAQ:SBUX). Part of the reason I think of Buffalo Wild Wings (NASDAQ:BWLD) is, the company is also growing fast, and is in the same strip-mall as Chipotle Mexican Grill, Inc. (NYSE:CMG) and Panera. Starbucks is a more direct competitor to Panera, and the company’s purchase of La Boulange, means their expanded food offerings will make this even more true.

Believable Predictions
There might not be anything more important than making sure predictions for growth are believable with a company like Panera Bread Co (NASDAQ:PNRA). Chipotle Mexican Grill, Inc. (NYSE:CMG) investors got a taste of what happened when unrealistic expectations meet harsh reality last summer. The company’s same-store sales came in weaker than expected, and the stock took a 30% nosedive fairly quickly.

Panera’s believable growth is the first reason investors should consider buying the stock. The company plans on opening between 7% and 7.5% new stores during 2013. When you combine this new store growth, with expectations for same-store sales growth of between 4% and 5%, you get a total of at least 11%. For a company that analysts expect to generate 19% EPS growth, a 11% or higher top line number is reasonable.

First And Second Place
The second and third reason to consider the stock are the company’s strong same-store sales, and their competitive operating margin. Of Panera Bread Co (NASDAQ:PNRA)’s peer group, the company is predicting strong same-store sales for 2013, and compared to their peers, no other company is predicting better results.