UPDATE: Jefferies Downgrades Panera Bread to Hold on Lack of Near-Term Visibility

In a report published Tuesday, Jefferies analyst Andy Barish downgraded the rating on

from Buy to Hold, but reiterated the $195.00 price target. In the report, Jefferies noted, “Longer term growth drivers appear fully intact, and continue to improve in many respects, but our near term EPS visibility is clouded by the prospect of reported traffic growth becoming incrementally impacted by throughput bottlenecks during peak hours, while incremental labor being added at the store-level to alleviate bottlenecks will weigh on margins. This operational issue came to light last month on the 2Q conference call, and although we believe the issue is fixable, we suspect many of the throughput initiatives will take at least a few quarters to remedy (adding additional physical capacity, implementing new production processes, reducing complexity in production system). We rate PNRA HOLD (from BUY) with a PT of $195 based on 24x our 2014 EPS or 11x EV/EBITDA.” Panera Bread Co. closed on Monday at $173.66.