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Investments Analysis

As a Wall Street analyst, using Exhibit 2 and other sources, what sectors and companies would appear to be good investments for the next two years to maximize growth? Why?

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Please see file response, which is also presented below. I hope this helps and take care.

1. As a Wall Street analyst, using Exhibit 2 and other sources, what sectors and companies would appear to be good investments for the next two years to maximize growth? Why?

Michael Brush is an award-winning New York-based financial writer who has covered business and investing for the New York Times, Money magazine and the Economist Group. Michael studied at Columbia Business School in the Knight-Bagehot Fellowship program. So his site should be credible.

According to Brush (2005), investing in smaller restaurants (i.e., 6 regional chains listed below) may be the way to go: "These 6 regional chains are selling cheap, have good growth prospects and offer a fresh take on casual dining. And company officers at each are buying." He notes two trends of investments are prevalent. The first is expected. "It's no surprise to find insiders dumping literally millions of dollars' worth of shares of each of the nation's blue-chip restaurant chains, including Applebee's (APPB, news, msgs), McDonald's (MCD, news, msgs), CKE Restaurants (CKR, news, msgs), Pizza Hut and Taco Bell parent Yum! Brands (YUM, news, msgs), Panera Bread (PNRA, news, msgs), Outback Steakhouse (OSI, news, msgs) and Cheesecake Factory (CAKE, news, msgs)" (http://moneycentral.msn.com/content/P83041.asp).

The second is less expected, though. Beneath the surface, though, you see exactly the opposite trend at six of our nation's small, regional restaurant chains: Mexican Restaurants (CASA, news, msgs), Rubio's Restaurants (RUBO, news, msgs), BUCA (BUCA, news, msgs), BJ's Restaurants (BJRI, news, msgs) (formerly Chicago Pizza & ...

Solution Summary

This solution explains what sectors and companies would appear to be good investments for the next two years to maximize growth and why.

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