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Sonic Boosts Dessert Offerings

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In a bid to improve brand recognition and cater to the changing consumer demand, restaurateurs are introducing differentiated value propositions. In keeping with this trend, the biggest chain of drive-in restaurants in the U.S., Sonic Corp. (SONC - Free Report) is focusing on menu innovation as one of its sales-driving strategies.

The restaurateur recently modified its popular Master Blast dessert offerings by adding new flavors. Guests can now taste Sonic’s Real Ice Cream in six new flavor options — Triple Chocolate, Turtle Pecan, Pineapple Upside Down, Banana Split, Chocolate Chip Cookie Dough and Caramel Brownie.

Among these flavors, Banana Split Master Blast and Pineapple Upside Down Master Blast are especially crafted for fruit lovers. Moreover, those who crave chocolates will have two Master Blast options — Triple Chocolate Master Blast or Turtle Pecan - to choose from. The new Master Blast flavors are expected to gain popularity within consumers very soon due to their delicious taste.

Apart from menu innovation, the company is also focusing on unit expansion to boost its business. Sonic has recently signed a franchise development deal to extend its association with a long-standing franchisee partner, Fran DeSimone. Per the agreement, the company will set up six drive-ins at Syracuse and Watertown in New York by 2018.

With the resurgence of consumer confidence, management accelerated its unit openings. In first-quarter fiscal 2014, the company unveiled six franchisees outlets, bringing the total to 3,517 restaurants. It plans to open 40 to 50 franchise drive-ins in fiscal 2014, slightly higher than fiscal 2013.

Other Stocks to Consider

Sonic currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the restaurant industry include Fiesta Restaurant Group, Inc. (FRGI - Free Report) , Brinker International, Inc. (EAT - Free Report) and Buffalo Wild Wings Inc. . While Fiesta Restaurant sports a Zacks Rank #1 (Strong Buy), Brinker and Buffalo Wild Wings have a Zacks Rank #2 (Buy).

Zacks Restaurant Recommendations: In addition to dining at these special places, you can feast on their stock shares. A Zacks Special Report spotlights 5 recent IPOs to watch plus 2 stocks that offer immediate promise in a booming sector. Download it free »

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