Three Alternatives to Buffalo Wild Wings

Shares of Buffalo Wild Wings (NASDAQ: BWLD) and Chipotle Mexican Grill (NASDAQ: CMG), both darlings in their industry, have plunged. Buffalo Wild Wings was down more than 10 percent at the close of Wednesday's session, following a disappointing earnings report late Tuesday, and was more than 17 percent lower in the past week. Chipotle posted disappointing results last week, and the share price has tumbled about 25 percent since then.

For investors who consider this a correction, the pull back in these two restaurant stocks presents a buying opportunity before they rebound. But for those who feel the ride may be over, it is time to look for alternatives. Here we consider Cracker Barrel Old Country Store (NASDAQ: CBRL), AFC Enterprises (NASDAQ: AFCE) and Brinker International (NYSE: EAT).

Cracker Barrel Old Country Store

Like all three of these stocks, Cracker Barrel has pulled back in the past week, in this case about 5 percent. The company has a market capitalization of about $1.4 billion. Its price-to-earnings ratio is less than the industry average. The long-term EPS growth forecast is more than 10 percent and the return on equity is almost 29 percent. The dividend yield is more 2.7 percent. Five out of eight analysts polled by Thomson/First Call recommend buying the stock. The consensus price target is more than 12 percent higher than the current share price. The stock has outperformed Denny's (NASDAQ: DENN) and the S&P 500 over the past six months.

AFC Enterprises

The share price has pulled back more than 7 percent in the past week. This Atlanta-based operator of the Popeyes Chicken & Biscuits chain's market cap is more than $500 million. The P/E ratio is higher than the industry average, but so is the operating margin. The long-term EPS growth forecast is about 12 percent, and the return on equity is a whopping 163 percent. Still, analysts seem to think the stock has some room to run, as their consensus price target is more than 13 percent higher than the current share price. Over the past six months, the stock has outperformed competitor Yum! Brands (NYSE: YUM), which operates the KFC chain, and it has outperformed the broader markets.

Brinker International

The share price of this operator of the Chili's Grill & Bar chain has pulled back from a recent multi-year high, but it is still almost 15 percent higher year to date. The Dallas-based company has a $2.3 billion market cap and a dividend yield of about 2 percent. Its long-term EPS growth forecast is more than 15 percent, and the return on equity is more than 36 percent. The P/E ratio is less than the industry average. But note that short interest is more than 9 percent of the float. And the consensus price target on Brinker is more than 5 percent higher than the current share price. Still, over the past six months, the stock has outperformed competitors such as Darden Restaurants (NYSE: DRI) and DineEquity (NYSE: DIN).

See also: KeyBanc Initiates Coverage on Restaurant Stocks