The Independent / Buy13 Apr 2007 10:04
Prezzo Our view: Buy
Share price: 83.75p (-1.5p)
So far everything the Kaye family has touched has turned to gold. Prezzo, which was founded by Philip Kaye, the man behind Golden Egg, Garfunkels and ASK Central, and his nephew Jonathan Kaye, has expanded rapidly since its flotation in 2002 with just four restaurants. Next week the pizza and pasta parlour will be celebrating the launch of its 100th restaurant, which opens in South Woodford, in Redbridge, north-east London.
The group beat City forecasts yesterday with strong full-year figures. Pre-tax profits jumped 41 per cent to £9.1m on a 45 per cent increase in turnover to £11.4m. Despite this, shares in the company dipped 2 per cent yesterday, which analysts put down to the fact that they have enjoyed a strong run since the beginning of the year, increasing by 50 per cent.
Speculation is also doing the rounds that Prezzo could be a takeover target for the private equity house Tragus after it lost out to the tycoon Robert Tchenguiz in the bidding war for the La Tasca tapas chain. The Pizza Hut owners Gondola and Paramount, the group behind Chez Gerard, are also on the look out for new brands. The restaurant boom shows no signs of slowing down and with the casual dining market the fastest grower, investors would do well to tuck into Prezzo shares.