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Kona Grill, Inc.

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Kona Grill is a Zacks #1 Rank (Strong Buy) after a series of upward estimate revisions. Analysts grew increasingly bullish after the company raised it outlook for Q3.

Company Description

Kona Grill has 23 restaurants across the U.S. offering internationally inspired cuisine. The dining room is a trendy but casual atmosphere.

Good Times Ahead

On Sep 19 the up-and-coming restaurant raised its third-quarter outlook. The company raised its top-line expectations to $24.1-$24.2 million. Each end of the range is up half a million dollars and should be driven by a 9% increase in same-store sales.

Kona's EPS outlook, as a result, rose to between $0.05 and $0.06. The edges of that range are up 4 cents and 3 cents, respectively. Investors are eagerly awaiting the Oct 25 earnings release to see if those targets are hit.

Analysts raised their outlooks for the remainder of 2011 as well as 2012 on the news. With a Zacks Consensus Estimate of $0.16 for this year, earnings are expected to more than triple.

The $0.19 average EPS forecast for 2012 represents an 18% growth rate.


Shares of KONA are going for 31 times the 2012 forecast, which leaves them with a 1.3 PEG ratio. The price to sales is near 0.5 and the price to book is just under 3.

A Wild Ride

Kona's stock has been all over the place lately. The most recent news has investors trying to push shares higher, but the heavy market has weighed it down. Expect the volatility to continue.

Read the Aug 15th Feature Here

Kona Grill - ticker KONA >

Bill Wilton is the Aggressive Growth Stock Strategist for He is also the Editor in charge of the Zacks Small Cap Trader service

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