On Wednesday morning, Burger King (BKW) boldly went where it’s been twice before: to the NYSE. This was not an IPO, just a reentering to the market. The fast food chain has been traded publicly twice before, this is the third go around. The stock was up 7% from its initial price of $14.50.
Brief History
BK coming back to the market is a result of a reverse merger with UK based Justice Holdings.
-In 2002, Goldman Sachs, TPG Capital, and Bain Capital took Burger King private.
-It was resold in 2006
-In 2010, 3G Capital took it private again
-Presently available to trade
Burger King is the second largest hamburger chain in the world, second only to McDonald’s (MCD). Wendy’s (WEN) is another competitor in the industry, although BK will be hoping that they can perform opposite of the two largest competitors who are both down between 10-15% on the year.
Other fast food chains like Pizza Hut and KFC (both under YUM) have done quite well recently, posting gains near 15% for the year.
Why This Time is any Different
Well, it may not be. McDonald’s and Wendy’s have been slipping and Burger King has a pretty similar menu. They introduced a more or less healthier menu with salads and fruit smoothies and plan to remodel many of their locations. They also added a new artery-clogger, the Bacon Sundae. (pictured above)
Over the next 5-7 years, BK is opening 1000 locations in China to expand their international presence.
Business Section: Investment Ideas
Could the new stores opening worldwide along with remodeling and a new menu be enough to sustain BKW growth? Or is McDonalds just too big to compete with and the same old Whopper not enough to get excited about?
-In other news, still no IPO since Facebook
1. Burger King Worldwide (BKW, Earnings, Analysts, Financials): Operates as a quick-service hamburger company. Most recent closing price at $ 15.62
2. McDonald’s Corp. (MCD, Earnings, Analysts, Financials): Operates as a foodservice retailer worldwide. Market cap at $91.18B, most recent closing price at $89.72.
3. The Wendy’s Company (WEN, Earnings, Analysts, Financials): Operates as a quick-service hamburger company in the United States. Market cap at $1.74B, most recent closing price at $4.45.
4. Yum! Brands, Inc. (YUM, Earnings, Analysts, Financials): Operates as a quick service restaurant company in the United States and internationally. Market cap at $29.67B, most recent closing price at $64.42.
Written by Ryan Horch
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I think third time's the more charm for BK. They still have a decent following on the market. Besides, I kind of miss their submarine lines. We have Burger King here in smallgoods melbourne.