Ms. Zackfia: Where I'm most positively inclined is the upscale-casual dining space and/or fast casual.
TWST: What is it about those two at this point?
Ms. Zackfia: Fast casual has actually shown improving traffic trends since April. In fact, the September quarter was the first quarter in which fast-causal comps eclipsed fast-food comps as the strongest category. I think you've seen the upper-middle-class consumer start to strengthen markedly, which really benefits fast casual. On the other hand, upscale casual dining - and by that I mean The Cheesecake Factories or P.F. Chang's - haven't necessarily shown as much traction in same-store sales trends, and I think investors have somewhat lost some patience with those names. But I view them as relatively safe havens in that they have high free cash flow yields and potential cyclical upside in earnings. I feel more strongly about The Cheesecake Factory at this point because the concept has already improved its same-store sales trends with some strategies that they've initiated this year.
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