Chipotle Mexican Grill, Inc. (CMG), Panera Bread Co (PNRA), Einstein Noah Restaurant Group, Inc. (BAGL): Discovering Investing Ideas During Lunch Hour

On the earnings front, none of the stocks in this group appear cheap based on trailing metrics. Factoring in growth using a PEG ratio doesn’t make the situation much more appealing at today’s prices. This is particularly true with Noodles & Co (NASDAQ:NDLS); the company became public in June, and significant hype has built surrounding the successful fast casual concept with less than 350 stores. The phrase “the next Chipotle” has been used more than a few times in reference to Noodles & Co (NASDAQ:NDLS), but while Noodles has plenty of room to grow, it will need to start growing faster than the 13 new locations it opened last quarter before it reaches 1,500 locations.

What to buy now?

While the valuation discussion above may dissuade investors from researching further, there are reasons to give Panera Bread Co (NASDAQ:PNRA) a deeper look. First, the recent share price pullback from $195 to $165 per share provides one of the more attractive entry points that has been available in recent years. Second, analysts’ estimated 17% growth rate may be a bit conservative considering that Panera has increased earnings by more than 29% over the past five years.

Perhaps more importantly, there are no signs that the growth story at Panera Bread Co (NASDAQ:PNRA) is winding down. The company retains the flexibility that its debt-free balance sheet provides, the number of locations continues to grow at a steady pace (37 bakery-cafes opened in the most recent quarter), and the company continues to ride the larger consumer trends toward fast casual and health-conscious dining. With such a solidly formed investment thesis, a trailing P/E of 26 does not seem unreasonable at all; it may not be a ten-bagger going forward, but market-beating, multi-bagger returns are certainly a realistic expectation.

The article Discovering Investing Ideas During Lunch Hour originally appeared on Fool.com and is written by Brian Shaw.

Brian Shaw owns shares of Chipotle Mexican Grill and Panera Bread. The Motley Fool recommends Chipotle Mexican Grill, McDonald’s, and Panera Bread. The Motley Fool owns shares of Chipotle Mexican Grill, McDonald’s, and Panera Bread.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.