UPDATE: Morgan Stanley Downgrades Panera Bread on Perceived Value Weakness

In a report published Monday, Morgan Stanley analyst John Glass downgraded the rating on Panera Bread Co. PNRA from Overweight to Equal-Weight, and removed the $190.00 price target. In the report, Morgan Stanley noted, “While check growth is a complex combination of pricing, mix, and catering, it is clear from our survey work that value is a perceived weakness in an otherwise sterling brand. One third of PNRA consumers indicate that menu prices are high, which we think lowers frequency. Another element of check growth, catering, has slowed recently, while investment spend will pressure 2H13 and possibly '14. Lowering EPS estimates to low end ‘13 guidance and below consensus in ‘14.” Panera Bread Co. closed on Friday at $164.03.