Re-Evaluating the Value in Panera Bread Co (PNRA)

First, the market is having a knee-jerk reaction to the Panera Bread Co (NASDAQ:PNRA) earnings statement, probably driving the stock lower than it “deserves.” Second, Panera is in the middle of a string of decent, but not great, news. The stock has been puttering along over the last year, so there’s no momentum to push the valuation higher. Third, Starbucks Corporation (NASDAQ:SBUX) is probably seen as a safer bet, since the company has been making lots of good decisions recently. Its expansion into more food items is being touted as a real winner, and its recent acquisitions are seen as good investments in the future of the business.

Overall, I agree with the market. Panera Bread Co (NASDAQ:PNRA) is a good business, and it certainly has more going for it than Darden Restaurants, Inc. (NYSE:DRI), which has been sluggish recently. But Panera is still figuring things out. While I’m not looking to expand my restaurant holdings, if I were, today’s drop might offer a good place to jump in. I still believe in the company, and the price change today is largely justified. If I could only pick one, though, I’d shell out and get Starbucks Corporation (NASDAQ:SBUX) — the future over there looks very bright. Check back on Friday morning to see if my trust is misplaced.

The article Re-Evaluating the Value in Panera originally appeared on Fool.com.

Fool contributor Andrew Marder has no position in any stocks mentioned. The Motley Fool recommends Panera Bread (NASDAQ:PNRA) and Starbucks and owns shares of Darden Restaurants, Panera Bread, and Starbucks.

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