The price drop which started 1.5 month ago is due to company's announcement of 3 rd quarter's results which did not meet the growth expectations. Also on October 18, 2007 the company announced a departure of its Vice President of Operations.
For the last quarter ended June 30, 2007 the company's revenue increased by 10% to $89.6 million. The net income also increased by 39% to $4.5 million. For the same period ended the stockholders equity has increased by 3.2% to $172.7 million and the tangible assets have increased by 3.8% to $146.1 million.
Despite all the lack of revenue growth over the 3 rd quarter the company is constantly expanding its business through the opening of new restaurants. With the newest restaurant opened on October 1, 2007 the assumption of long term revenue growth looks quite feasible. Assuming the company will be able to successfully expand in the future it would affect the stock price to eventually increase.
However given current situation our analysis based on company's earnings growth and financial state shows price decrease over the coming 18 months. This is also supported by the technical price chart analysis which shows that the price might go lower over the coming month.
