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Cosi Shares Jump on Full-Year Outlook
Wednesday January 10, 1:05 pm ET
Cosi Shares Soar More Than 15 Percent on Projection of a Narrower 2006 Loss

NEW YORK (AP) -- Shares of restaurant chain Cosi Inc. jumped more than 15 percent Wednesday, after the company forecast a narrower-than-expected full-year 2006 loss, and said it anticipates moving to a profit in 2007.

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Cosi said it now expects a loss of 18 cents per share in 2006, excluding stock-based compensation expenses, versus a 28-cent loss in 2005. Analysts are looking for a loss of 25 cents per share, according to a Thomson Financial poll.

For 2007, Cosi projected earnings before options costs of 8 cents to 12 cents per share, compared with Wall Street's view of a 3-cent loss -- including options expenses.

The company also reported fourth-quarter sales grew 11 percent to $31.7 million, but missed Wall Street's target of $35.1 million.

Despite the more positive projection, Cosi said it was disappointed with its quarterly same-store sales -- or sales at restaurants open at least a year. The figure is considered a key measure of performance. Cosi reported an increase of only 0.4 percent, compared with an 8 percent rise in the year-ago period.

Investors, however, did not seem discouraged by the same-store sales number. Instead, they bumped the stock up 84 cents, 16 percent, to $6.11 in midday trading on the Nasdaq. Over the past year, shares have ranged between $4.20 and $11.21.

Avondale Partners analyst Amy G. Vinson said the same-store sales numbers were, in fact, no disappointment since she was expecting a 4 percent decrease for the quarter following a lackluster third quarter in which same-stores sales fell 4.2 percent.

But, she said, the figures suggest that either "the customer did not respond to the marketing and customer loyalty initiatives as well as they had hoped" or "traffic was relatively light."

Cowen and Company analyst Paul Westra said although the yearly loss is now projected to be narrower than last year's, he added that it was "extremely frustrating" that Cosi has been unable to achieve its own targets and guidance for the year. In November, Cosi projected a yearly loss, excluding stock-option costs, of between 9 cents and 11 cents per share.

Regardless, Westra was still optimistic about the company's chances for success in the future.

"Despite the continued development and earnings per share misses, we nevertheless believe shares represent compelling value at today's levels as we remain confident that Cosi remains the best-positioned concept to secure the No. 2 spot in the proven Premium Convenient Sandwich category," Westra said.

Cosi operates and franchises more than 100 restaurants serving sandwiches, coffee and cocktails in about 15 states.



Cosi Falls on Analyst Downgrade
Wednesday January 17, 11:23 am ET
Cosi Falls on Analyst Downgrade, Cites Recent Share Rise, Sales Concerns

NEW YORK (AP) -- Shares of sandwich chain operator Cosi Inc. declined Wednesday after a Wedbush Morgan Securities analyst cut his rating on the company, noting a recent share rise.

Shares fell 29 cents, or 4.5 percent, to $6.18 in early trading on the Nasdaq. The stock has traded in a 52-week range of $4.20 to $11.21 and is down 34 percent in the same period.

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Brian Moore in a client note cut his rating on Cosi to "Buy" from "Strong Buy" but reaffirmed a $7 target price.

He cited the stock's 27 percent rise from the beginning of the year, which is mostly due to a run-up following the company's Jan. 10 forecast for a narrower 2006 loss.

Moore noted that it will be difficult for the company to improve on its first-quarter 2005 same-store sales growth of 5.3 percent. Same-store sales measure sales at stores open at least a year.

He noted investors tend to focus closely on the metric, which is considered a leading indicator of a retailer's health. Cosi has no significant, new products coming out that could boost sales performance during the quarter, wrote Moore.

The next potential lift to shares could come in the second or third quarter, when Cosi expects to open up to five new units in the large Los Angeles market, the analyst wrote.





Es genügt nicht, keine Gedanken zu haben, man muss auch unfähig sein, sie auszudrücken.

hat Gewinn angekündigt weil Konkurrent nach Klage aufgegeben hat