Shares of chicken wing purveyor Wingstop jumped 61 percent in their Friday debut, making the fast food company just the latest restaurant name to surge since unveiling shares. And that has led to the observation that the fast food space may currently be marked by a good deal of momentum-driven sentiment.
"I think you have to be very careful about the 'food of the month club,' not because they're bad businesses, but just because the way these things trade, they tend to have a lot of froth in momentum and then the investing aperture goes somewhere else," said Zachary Karabell, global head of strategy at Envestnet.
Other recent restaurant offerings include Shake Shack (up some 250 percent from its May IPO) and Papa Murphy's (up almost 80 percent from its May 2014 offering). Of course, the grandaddy of trendy fast food stocks is Chipotle, which is trading at almost than 14 times the price at which it was initially offered in 2006, on the back of massive earnings growth.