Wendy’s will be joining GameStop, AMC as the latest to play

Retail traders have a new perspective Wendy’s..

Fast food chain stocks soared about 26% on Tuesday to break the record. Post to Reddit’s popular WallStreetBets forum Wendy’s advertised it as a “perfect inventory” for the group because of its signature product and its presence on “effective” social media.

What attracted the group’s attention was the latest, the so-called meme stock.On the ever-growing list Game stop, AMC And Bed Bath & Beyond..

Two market analysts warned investors about riding the hype.

“I think the Reddit crowd is pushing it up today because the floats on Wendy’s retail stocks are pretty small, but I can assure you that nothing will change overnight to change the underlying story. “Gradient Investments President Michael Binger told CNBC. “Trading nation” on Tuesday.

The company has adopted a “decent business model” and can benefit from the economic resumption, but despite only 3% sales growth, stocks trade at significantly higher price-earnings ratios. He said.

According to FactSet, stock prices exceed analysts’ average price target of $ 27.85.

“We are looking for a gap between valuation and fundamentals,” Binger said. “I don’t think trading here is a good entry point as the price targets here are trading at these levels. Unless you are the most agile trader, you won’t get close to Wendy’s here. I think we’ve reached the price. ”This is a goal and is relatively expensive compared to other stocks in the group. “

In an interview with the same “Trading Nation,” Chantico Global founder and CEO Gina Sanchez said other names in this category are far more appealing.

Not only did Wendy’s significantly outperform its peers in the process, Coronavirus pandemicBut the expectations of lockdown are also inadequate, said Sanchez, chief market strategist at Lido Advisors.

“Their expectations from the pandemic are fine. It’s not bad, it’s a proven business model, but it’s not as good as the rest of the group,” she said.

Blinker It didn’t work very well during the pandemic, but there are high expectations. Therefore, this strain is less attractive than other strains. “


Wendy’s will be joining GameStop, AMC as the latest to play

Source link Wendy’s will be joining GameStop, AMC as the latest to play

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