Sonic Shares Fall on Weak Quarterly Same-Store Sales Outlook
May 18 2016 - 12:00PM
Dow Jones News
Sonic Corp. shares declined Wednesday, a day after the drive-in
restaurant chain said it expects same-store sales growth for its
current quarter will come in below the stepped-up pace it detailed
in March for the full year.
The Oklahoma City company's shares fell 5% to $30.89 in recent
trading.
Sonic said its guidance for sales at established stores for the
three-month period that ends May 31 reflects an industrywide
slowdown in customer traffic and unfavorable weather.
In late March, the fast-food company reported quarterly results
that topped analysts' expectations and boosted its guidance for its
fiscal year that ends in August. The company's boosted outlook
called for an increase of 20% to 25% in per-share earnings,
excluding certain items, and same-store sales growth of 4% to
6%.
Sonic, which also affirmed its annual earnings outlook, said its
board authorized the repurchase of an additional $155 million of
its shares, on top of the more than $21 million remaining in its
current stock buyback program. The company has a market value of
roughly $1.6 billion.
Sonic has about 3,500 restaurants styled after 1950s drive-ins,
including some with carhops who deliver orders on roller
skates.
Write to Tess Stynes at tess.stynes@wsj.com
(END) Dow Jones Newswires
May 18, 2016 11:45 ET (15:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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