P.F. Chang's Pei Wei in Mexico - Analyst Blog
19 Ottobre 2011 - 1:45PM
Zacks
P.F. Chang's China Bistro
Inc. (PFCB) recently inked a development agreement with a
Latin American quick service restaurant and casual dining operator
Alsea, S.A.B. de C.V. to spread its Pei Wei Asian concept in
Mexico. The first location is slated to open in Mexico City in few
months from now.
Per the deal, Alsea will set up
three restaurants during the first 18 months. It also entails the
company to a long-term option to open 50 restaurants over 10 years.
P.F. Chang's has a long-standing relationship with Alsea and
already operates eight restaurants in Mexico under an exclusive
development and licensing agreement signed in 2009 to develop 30
P.F. Chang’s restaurants throughout Mexico over 10 years. In May
2011, Alsea also entered into a similar agreement with 17 P.F.
Chang’s restaurants for development in Argentina, Chile and
Colombia over the next 10 years.
The recent deal affirms
management’s intent to make Mexico one of the prime markets for
international expansion. The company’s restaurants have so long
been well received by Mexican customers. This inspires P.F. Chang's
to take its Pei Wei experience to that market.
Alsea is the leading operator of
quick service restaurants, coffee shops and casual dining
establishments in Latin America, operating successful brands such
as Domino’s Pizza Inc. (DPZ) and Burger King,
Chili’s Grill & Bar of Brinker International
Inc. (EAT).
P.F. Chang's, which owns and
operates two restaurant concepts namely P.F. Chang's China Bistro
and Pei Wei Asian Diner has successfully operated restaurants in
the domestic market while many of its international locations are
operated by franchise partners. We believe that the company is
trying to spread its presence beyond the U.S. more aggressively
following cutthroat competition in the rather saturated domestic
casual dining market.
P.F. Chang's currently retains a
Zacks #4 Rank, which translates into a short-term ‘Sell’ rating. We
also maintain our long-term “Underperform” recommendation on the
stock.
DOMINOS PIZZA (DPZ): Free Stock Analysis Report
BRINKER INTL (EAT): Free Stock Analysis Report
PF CHANGS CHINA (PFCB): Free Stock Analysis Report
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