Fidelity National Financial
), recently announced a newly formed luxury restaurant company,
J. Alexander's LLC, targeting the upscale dining segment.
The company will continue with the thirty two J. Alexander's
concepts on the earlier menu and with the ten Stoney River
Legendary Steaks concepts. Stoney River was previously owned by
Fidelity's casual and family dining focused restaurant company,
American Blue Ribbon Holdings, LLC (ABRH).
J. Alexander's acquired Stoney River from American Blue Ribbon
and allowed the latter an approximately 28% ownership position in
the new company. Consequent to the deal, the restaurant service
of Fidelity now has 55% and 87% ownership position in American
Blue Ribbon and J. Alexander's respectively and both will be
headquartered in Nashville.
The deal is expected to augment the existing upscale dining
oriented restaurant operations of Fidelity. As per management,
restaurant operations can be best managed through separate
emphasis on upscale dining focused companies, and family and
casual dining focused companies. It enables both to reap maximum
benefits from the respective market segments. With formation of
J. Alexander's LLC, Fidelity aims to enhance its upscale dining
operations and hence maximize its overall value of restaurant
operations thereby retaining investor confidence.
On the other hand, Fidelity's exclusive focus on the upscale
industry will upgrade J. Alexander's restaurant operations.
Moreover, the incorporation of Stoney River in its operations
will help it realize its goal as a consistent leader in quality
dining. It will also go towards improved financial performance of
We expect the formation of J. Alexander's to push up the
earnings of Fidelity by driving up sales through customer base
enhancement. The Zacks Consensus Estimate for the first quarter
of 2013 is pegged at 41 cents representing a year-over-year
improvement of 28.1%.
Fidelity National has a consistent track record of
acquisitions and partnerships to strengthen its existing lines of
businesses. Earlier this month, Digital Insurance - a
wholly-owned subsidiary of Fidelity announced a partnership with
CUNA Mutual Group, a financial service provider dedicated to
catering to the members and customers of employee unions.
Another title insurance provider,
Stewart Information Services
), has entered into a partnership with the Canada based
TELUS Financial Solutions
) in October, 2012. It will function as the exclusive sales
channel offering mortgage instructing and reporting solutions to
the legal community.
Fidelity currently carries Zacks Rank #3 (Hold). Among others
from the industry,
Cincinnati Financial Corp.
) carries a favorable Zacks Rank #1 (Strong Buy) while Stewart
and TELUS share the same Zacks Rank with Fidelity.
CINCINNATI FINL (CINF): Free Stock Analysis
FIDELITY NAT FI (FNF): Free Stock Analysis
STEWART INFO SV (STC): Free Stock Analysis
TELUS CORP (TU): Free Stock Analysis Report
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