El Pollo LoCo Holdings Inc. (NASDAQ: LOCO) pulled back a bit Tuesday from big gains racked up following its $15 a share public offering last week.
Shares of the chicken-restaurant chain reached a high of $32.48 Monday but fell more than 10 percent on Tuesday.
With slow growth in U.S. consumer spending, Bank of America’s Gregg Nabhan told the Wall Street Journal recently that “high-growth retailer and restaurants are having a tougher experience so far this year.”
Indeed, for the quarter ended March 26, El Polo posted revenue growth of only 4.4 percent to $81.4 million while same-store sales grew 5 percent. The company posted a small quarterly profit after no less than seven straight years of losses.
El Pollo, whose eateries bear some resemblance to Los Pollos Hermanos restaurant in television’s “Breaking Bad,” expects to use most of its $112.8 million in proceeds from the recent offering to pay off part of its $288.8 million in debt.
The company, whose restaurants are mainly in the Los Angeles area, was operated by Denny’s for 16 years and sold to private equity investors in 1999.
El Pollo withdrew a proposed initial public offering in 2006 citing market conditions.
Shares traded recently at $30.78, down nearly 11 percent.
View more information: https://www.benzinga.com/analyst-ratings/analyst-color/14/07/4738437/el-pollo-loco-pulls-back-slightly-from-big-gains-on-ipo