Wendy's Shares Rise on Strong Sales Outlook
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Wendy's International Inc. (WEN) shares jumped Wednesday after the company forecast same-store sales in 2005 to rise between 1 percent and 2 percent.
The outlook was given during a conference call to discuss the No. 3 U.S. burger chain's announcement late Tuesday that it would report a loss in the current quarter, with plans to close 15 to 18 of its Mexican-style Baja Fresh (search) restaurants.
Shares jumped more than 7 percent in early trading.
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"Where results have suffered, actions are being taken, and where the performance has measured up, existing strategies are allowed to run their course," Piper Jaffray analyst Peter Oakes said in a research note. "Even in its state of transition, operating earnings appear to be stabilizing."
Wendy's said it would give a full forecast for 2005 in February.
Shares of Dublin, Ohio-based Wendy's were up $2.54, or 7.1 percent, at $38.21 in New York Stock Exchange (search) trade after climbing as high as $38.50.