THE COMPANY The concept is differentiated, serving (at more than 461 locations) a wide variety of noodles, pasta, soups, salads and appetizers at lunch and dinner, every dish made to order. The average expenditure per person is a modest $12.50, from a menu that can be enjoyed inside the 368 company and 93 franchised restaurants, taken to-go, or by delivery. The Company aims to eliminate the “veto vote” by satisfying the preferences of a wide range of customers, whether a family, a group of coworkers, an individual or a large party. The menu travels well, so is particularly well suited for off-premise dining occasions. The variety of flavors, dishes prepared to order, fast service and price/value appeal allows Noodles to compete against multiple segments throughout the restaurant industry and provides a larger addressable market than competitors who focus on a single cuisine. It is also a positive that 44% of customers have household incomes above $100k and 44% (also) of customers are no more than 35 years of age. At the same time, over the last five years, the Company has responded to the customer increased desire for convenience by improving the off-premise appeal. At this point almost three quarters of the meals prepared are consumed away from the store so smaller locations are now planned.
And the answer is time to sow. Very surprising collapse in SSS in Q2 (although inline with industry).
Happy to see the "Slow growth" strategy being announced cutting unit growth to 5% from 10%. Would have loved to see it go to zero for now. Not a fan of the stock buyback if it is going to use debt to do it. That will just make things worse. After the digital board upgrade is finished in Q4, that should take some pressure off of out spending CFO. This is the second time NDLS has tried to grow fast and had to hit the brakes. The CEO has been there this whole time (originally as CFO). Would not be shocked to see the two activists bring in a new CEO to shake up the culture. The CFO is high quality and very experienced, which might help stabilize the business. Disappointing for sure, but not out of the range of possibilities and lots of the dreaded "optionality" still in the company at this valuation. Around 5X EV/EBITDA with new guidance.
It is called Mono
And the answer is time to sow. Very surprising collapse in SSS in Q2 (although inline with industry).
Happy to see the "Slow growth" strategy being announced cutting unit growth to 5% from 10%. Would have loved to see it go to zero for now. Not a fan of the stock buyback if it is going to use debt to do it. That will just make things worse. After the digital board upgrade is finished in Q4, that should take some pressure off of out spending CFO. This is the second time NDLS has tried to grow fast and had to hit the brakes. The CEO has been there this whole time (originally as CFO). Would not be shocked to see the two activists bring in a new CEO to shake up the culture. The CFO is high quality and very experienced, which might help stabilize the business. Disappointing for sure, but not out of the range of possibilities and lots of the dreaded "optionality" still in the company at this valuation. Around 5X EV/EBITDA with new guidance.
What font do you use on this investing blog? Looks distinguished and love it.