Industry News | April 26, 2002

Tastier food seen lifting Wendy's quarterly profit

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NEW YORK, April 26 (Reuters) –As reported by Vivian Chu of Reuters: Wall Street analysts are predicting that Wendy's International Inc. (NYSE:WEN) will report strong first quarter earnings on next Wednesday's quarterly release. Just this past Thursday, Wendy's stock rose to an all-time high of $38.32 per share. The company also reported that March sales in restaurants open at least one year rose 6.1 percent, above its own its expectations.

Industry consultant are attributing Wendy's rising share of the quick-serve market to the chain's new salad line. But, say some analysts, much of Wendy's recent success is a result of what the company is doing right outside of its menu and the woes of its nearest competitors, McDonald's and Burger King. Recently, both rivals have been plagued with poor consumer perception issues.

"Salads have been helpful, but the most important part is that Wendy's is a hamburger chain and they're positioned very favorably with full-value, brand positioning," said analyst Allan Hickok at U.S. Bancorp Piper Jaffray told Reuters. "Consumers perceive Wendy's to have a higher quality product, and they are willing to pay more for it. That's the backbone of their business," Hickok said.