Texas Roadhouse Reports Slight 4Q EPS Miss, Sterne Agee Maintains Neutral

Sterne Agee has published a research report on Texas Roadhouse, Inc. TXRH after the company reported a slight 4Q EPS miss but still showing signs of solid SSS and traffic. In the report, Sterne Agee writes "Texas Roadhouse, Inc. announced solid same-store sales (SSS) and traffic for 4Q10 that has carried into 1Q11. However, the Company reported a slight EPS miss vs. our expectations given lower restaurant-level margins and higher SG&A. While encouraged by the sales performance, we believe that margin pressure will likely continue to some extent in FY11 and particularly in FY12 as higher beef costs could become a factor. In conclusion, we view the downside risk vs. upside opportunity as fairly balanced for TXRH at these levels." Sterne Agee maintains its Neutral rating on Texas Roadhouse, which closed yesterday at $17.74.