Few things excite Jim Cramer more than growth. And he thinks this restaurant stock has growth in spades.
The stock is Popeyes Louisiana Kitchen, formerly AFC Enterprises.
Although the chain currently has a sizable number of locations, about 2,225, he still sees Popeyes as a regional to national story, one of Cramer's favorite investable themes. "It could nearly triple in size to 6000 locations before it runs out of room to expand," he said.
However, growth isn't the only reason why Jim Cramer is a Popeyes bull. The company is also actively remodeling stores and he says remodeling tends to goose traffic.
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"These remodeled restaurants are seeing sales volumes that are four percentage points higher than the system average, a very nice bump," Cramer said.
Also Cramer is a fan of the company's CEO, Cheryl Bachelder.
According to Cramer, Bachelder is an executive who not only understands how to leverage opportunity, she actively generates value for shareholders.
To support his thesis, Cramer said, "I first recommended Popeyes roughly a year and a half ago, back in August of 2012, and since that time shares have returned 72%!"
In fact, Cramer likes the Popeyes CEO so much, he's named Bachelder as one of his bankable 21 in his new book, Get Rich Carefully.
That's not to say there isn't any cause for concern – there is.
When Popeyes preannounced same store sales recently, the company cited a meager 0.8% increase. Typically, a growth story should generate big growth. That didn't happen last quarter.
Although Cramer believes disappointing metrics must always be noted, when larger trends remain intact, he's inclined to think they're more likely a blip on the radar, rather than a sign of bigger trouble.
Therefore, he thinks it's strategic to be greedy when others are fearful.
"With the stock down about five points from its highs, I remind myself that Popeye's still has a tremendous runway in front of it," Cramer said. "I'm still a believer."
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