Chanticleer Holdings logoIn news this morning, Chanticleer Holdings Nasdaq: HOTR) announced the successful acquisition of Little Big Burger restaurants with 8 locations in Oregon and a 9th location opening in Portland by the end of this year.

The acquisition adds over $1 million of annual EBITDA immediately, and will make HOTR EBITDA positive in Q4 2015 and onward according to the CEO, Mike Pruitt (press release).

 
  • Loading stock data...


HOTR has by far the lowest Price/Sales and Price/Book ratios in the restaurant group combined with 65% revenue growth.

Company  Symbol Market Cap Price/Sales (ttm) Price/Book (mrq) Qtrly Revenue Growth (yoy):
Darden Restaurants DRI $8.7 billion 1.3 3.6 13.8%
Shake Shack SHAK $1.7 billion 3.74 5.1 74.7%
Kona Grill KONA $175 million 1.4 3.2 21.2%
Chipotle CMG $22.3 billion 5.1 9.9 14%
Jack In The Box JACK $2.8 billion 1.8 26.5 3.2%
El Pollo Loco LOCO $410 million 1.2 1.8 2.9%
Chanticleer Holdings HOTR* $16 million 0.4 0.9 64.9

Note: *The numbers for HOTR do not include accretive contributions from today’s announced acquisition.

 

Bottom line, there is not a restaurant stock out there with faster sales growth and more attractive P/S and P/B multiples than HOTR.

 

With the positive effect low gas prices typically have on casual restaurants, strong sales growth far exceeding the industry average, and the company turning EBITDA positive this year, I remain very bullish on HOTR shares and added to my position today.

And I’m not the only one adding shares.

Institutions have been buying more HOTR shares also, with 9 institutions adding 1.2 million shares in the most recent figures available.

With today’s news I expect institutional participation in HOTR to continue to increase.

Chanticleer - acquisition

Source: Nasdaq.com

 

There are times to sell a stock, times to average up, and times to average down.

Despite the recent volatility and underperformance in share price, HOTR is a stock I want to own in Q4 and into next year and I added to my position today.


 

Pulmatrix sig.

Disclosure: I own shares of Chanticleer Holdings (HOTR).

I did not receive any payment from any party for this article.

Disclaimer


Subscribe to MicrocapResearch.com (it’s FREE!) and find the next great microcap stock.

 

3 thoughts on “Chanticleer Holdings (HOTR) Closes Little Big Burger Acquisition, Turning EBITDA +

  1. Gary, there is nothing but good news on this company. And yet it still keeps going down. What is it going to take to get this stock going?

  2. Hi Barry,

    I think the move to EBIDTA + will certainly help. We’re in a tough market right now- a lot of folks who bought the rights offering at $1.35 could sell today- and are probably just taking the loss and moving on.
    It’s a fickle market- one month a stock is ultra-hot, then it’s suddenly not. But when the financials keep improving, and the company is making all the right moves, I’m fine with adding to my position – and that’s the case here.

    The fact that several key/large investors were willing to pay a premium for this deal to go thru speaks volumes about their faith in management.

    Gary

  3. Pingback: 4 Great Stocks to BUY After Biggest Intraday Upside Reversal in 4 Years: (SLTD), (VUZI), (HOTR) and (NVIV) - MicrocapResearch.com - Researching The Best Microcap Stocks

Leave a reply

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong> 

required