Panera and Chipotle Both Trade Up After Earnings

Competitors Chipotle CMG and Panera PNRA released their fiscal fourth-quarter earnings reports after the closing bell on Tuesday. Although the two companies are differentiated in their menu offerings, Chipotle and Panera compete on price point and have a lot of overlapping customers in some regions. Both stocks have traded up moderately in the wake of the results, with PNRA adding 3 percent and CMG climbing nearly 5 percent at last check. Chipotle, which saw its high-flying stock price dinged in the Fall, reported earnings per share for the fourth-quarter of $1.95 versus $1.81 last year. This missed consensus estimates by one penny. Revenue for the quarter was up 17.2 percent to $699.2 million, which came in ahead of Street consensus of $698.86 million. Investors are buying the stock as the latest quarterly results showed that Chipotle's business is humming along reasonably well and valuation is starting to become compelling once again. Panera reported fourth-quarter earnings per share of $1.75, up from the $1.31 the company reported in the year ago period. This beat analysts' consensus EPS estimates of $1.74 by a penny. Revenue rose 15 percent to $571.5 million, which missed Street estimates of $574.6 million. Same-store sales at the company were up 4.9 percent in the quarter. Panera's results reflected Chipotle's in that they weren't out-of-the-park good, but at least showed investors that things are going relatively smoothly with the business. Both companies have been strong performers in their industry and have accumulated a fair amount of goodwill on Wall Street. For stocks with the earnings and revenue growth track records of Chipotle and Panera, the market can be forgiving of ho-hum quarters.