Wendys Reverses Early Gains And Tumbles Following Q1 Beat

Shares of Wendys Co WEN were trading lower by more than 6 percent Wednesday despite reporting a better-than-expected first quarter results.

Wendy's stock initially traded higher by more than 10 percent on light early volume after the company said it earned $0.11 per share in the first quarter on revenue of $378.8 million. Wall Street analysts were expecting the company to earn $0.06 per share on revenue of $352.08 million.

Wendy's also boosted its full year fiscal 2016 outlook and expects to earn $0.38 to $0.40 per share on same-store sales growth of around 3 percent. The company previously guided to earn $0.35 to $0.37 per share for the full year.

However, investors and traders may have been reacting to Wendy's update on a data breach. The company noted that earlier this year it conducted a comprehensive investigation into unusual credit card activity at some of its restaurants.

Wendy's believes malware was installed at fewer than 300 of its approximately 5,500 franchised North America Wendy's restaurants. In addition, the company has been named as a defendant in two putative class action suits in the U.S. on behalf of customers and payment card issuing banks seeking damages from the data breach.