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Got Wings: Buffalo Wild Wings Flies After Earnings

Prices for traditional chicken wings remain high.

Buffalo Wild Wings shares are soaring after the company delivered a big earnings beat, giving investors hope that the company could be back on track after a rocky year.

The bar chain reported earnings per share of $1.36 for its latest quarter, up 5.4% relative to a year ago. Analysts were expecting earnings of just 79 cents a share.

Management said that the company’s decision to focus its Tuesday promotional day on “boneless wings,” rather than traditional ones, contributed to the better-than-expected results. Boneless wings, which are really just breaded chicken breasts, helped the company cut costs amid persistently high prices for traditional wings.

Even with the after-hours gains, Buffalo Wild Wings shares are still down on the year. The company is under pressure to reaccelerate sales growth and cut costs. In June, investors elected three board members who were nominated by activist investor Marcato Capital Management. Marcato wants the company to improve its technology and franchise more of its locations.

Buffalo Wild Wings still faces a number of big tests. The current quarter is a crucial one for the chain, as its restaurants are popular during football season. And it remains to be seen whether the promotional change will hurt Buffalo Wild Wings’ long-term standing with loyal customers who prefer real wings over boneless ones.

Shares are up 20% in after-market trading.


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