Restaurant results dash 2010 recovery hopes

LOS ANGELES (Reuters) - Chipotle Mexican Grill Inc , Buffalo Wild Wings Inc and BJ's Restaurants Inc dashed hopes that 2010 would be the year restaurant spending fully recovers.

Shares in the sector tumbled in after-hours trade as the casual dining chains forecast disappointing results for the year, led by a 14.5 percent drop in Buffalo Wild Wings and a 3.5 percent decline at Chipotle.

Expectations were high going into Thursday's financial reports since several companies had already given preliminary results for the fourth quarter that beat Wall Street forecasts. Restaurant stocks have been a leading indicator of improved consumer sentiment and economic recovery.

BJ's said it does it not expect consumer spending in restaurants to recover in 2010 and its shares slipped 1 percent in extended trade.

Chipotle disappointed investors with its forecast for flat 2010 same-restaurant sales, despite a 2 percent gain in sales at established restaurants in the latest quarter. Chipotle shares fell from their close of $101.12 to $97.60.

Panera , the bakery and cafe chain which has some of industry's strongest same-store sales growth, forecast 2010 earnings below the Street view. and its shares fell 3 percent.

Buffalo Wild Wings said higher expenses were to blame for fourth-quarter profit growth that lagged Wall Street's expectations. Shares in Buffalo Wild Wings fell to $41.40 in extended trade from their Nasdaq close of $48.40.

(Reporting by Lisa Baertlein; editing by Gunna Dickson)

WhatsAppFacebookTwitterLinkedinBeloudBluesky