BJ's Restaurants, Inc. BJRI shares jumped Thursday after the company beat fourth-quarter profit expectations by 14 percent and analysts raised their targets.
The restaurant chain traded recently at $54.43, up 16 percent.
Stifel's Michael Olsen boosted his target 9 percent to $60 a share and maintained a Buy rating; Barclays' Jeffrey Bernstein hiked his objective 15 percent to $46, but kept the shares rated at Underweight.
Bernstein said BJ's 32 percent earnings growth in 2014 stemmed largely from cost cutting.
The key going forward, Bernstein said, will be sustained improvement in same-store sales.
BJ's said Wednesday that same-store sales quarter-to-date were up about 5 percent, from a 1.2 percent growth rate in the fourth quarter.
Bernstein expects the company's same-store sales will increase by an average of 2 percent in the current period, helped by lower gasoline prices and relatively benign weather, compared with a year earlier, in the 15 states where BJ's operates.
"Our primary concern is valuation," Bernstein said, noting the company's share price is 14 percent more expensive than peers on average, on a forward price-to-earnings comparison.
Olsen, obviously more optimistic, called the company's in-store profit margin outlook "wildly conservative" for 2015.
The company forecast the measure will be roughly the same as the fourth quarter's 18.4 percent. But Olsen said the fourth quarter for restaurants typically yield their narrowest margins.
"Full-year margins tend to be 50 basis points higher," Olsen said.
Olsen, who expects further cost cutting at BJ's, raised his 2015 earnings estimate 8 percent to $1.30 a share, versus the current Wall Street consensus of $1.19.
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