Comp sales are sexy and get the headlines but keep in mind total revenue is what matters. The lower revenue number is expected, of course, but it is no less painful. I would caution investors that are really excited about the comp number to remember that the company is still shrinking rather rapidly in terms of total revenue. In short, Wendy's is doing everything right to get people in the door and not only is Q3 a continuation of a great effort in Q2, but it represented an acceleration as well.Īs good as the comp numbers were, fewer company-owned restaurants still meant that total sales declined 6.5% during the quarter despite the high comp number. The apparent early success of the 4-for-$4 deal will likely drive additional upside in Q4 and beyond for comp sales numbers. Comp sales increases like that are nice for anyone but in particular, a company trying to implement a turnaround. That is a great number and even stronger than Q2's comp sales gains so investors are excited for good reason.

Wendy's continued its string of strong comp sales gains as Q3 saw a consolidated 3.1% gain at North American restaurants. In other words, the model isn't broken but investors are expecting more and more and more and I just don't see it. In addition, margins have been rising, producing higher profitability on its sales. The company's efforts are bearing fruit as comp sales continue to rise and the company's re-imaging campaign is the obvious catalyst. Wendy's has been in the midst of a well-publicized turnaround for some time now after it struggled in the past. My issue with Wendy's back in September was not that the company was broken but that investors were expecting too much. The company's Q3 results have the bulls excited and spending their money on WEN shares so is it time to throw in the towel on the bearish side and join the party? And while the stock ultimately went lower subsequent to my bearish call, it is now much higher than it was at the time. Back in September, with the stock at $9, I said it was expensive and that it couldn't grow into its valuation. After beginning the year with an epic rally it subsequently plummeted to $8 before rebounding in a big way in excess of $10 of late.

Fast food chain Wendy's ( NASDAQ: WEN) has certainly had a rocky 2015.

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