Diversified Restaurant Holdings (SAUC) operates the Buffalo Wild Wings Grill and Bar franchise throughout the United States. As of March this year, the company had 64 franchised restaurants in 5 states producing $162M in sales (nearly double the market cap) and $4M in net income. Income grew 801% this year and are projected to grow another 110% in 2018.
All analysts hold a buy or better on the company with a $4 price target. Share currently have a Zacks Rank of 1 (strong buy) on recent earnings estimate revisions. the stock recently hit highs over $4/share on record historic volume. Yesterday’s large profit taking dump was on no news and provides a nice entry here for those who missed the recent 400% 5-month rally.
We see shares of $SAUC trading higher over the next 3 to 5 months based on valuation and price momentum. We would buy small here, larger size down to $2.75 and sell at around $4.50.
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