(FORTUNE Magazine) – TIME TO LOAD UP YOUR PLATE

"Panera is a classic rocketship-growth company, which still has tremendous potential," says Elliott. He sees the bakery chain's recent pullback from the high 40s as a response to the recent slowdown in same-store sales. But Elliott argues the falloff doesn't indicate a major competitive or consumer shift. Per-store sales may be maturing, but cash flow per store is still healthy and "can go down some and still be attractive to any franchisee." With only a small proportion of U.S. consumers exposed to the chain to date, Elliott views the trailing P/E of 39 as standard for a highflying growth stock. He's confident the stock will hit $50 in the next 12 months.

SKIP THIS MEAL

"We are concerned with the divergence between company and franchised store same-store sales, growing competition from large-cap fast food peers, and the potential impact of low-carb diets on sales," notes Witter. While Panera has filled a market void, according to Witter, and driven solid unit-level returns, she sees the split in store sales as a potential sign that growth is coming at the expense of consistent execution. And, she notes, "as the low-carb, high-protein philosophy continues to gain momentum, Panera's bread platform could become its Achilles' heel."

OUR TAKE

Panera's stock is off 23% from its September high, but earnings growth remains strong--and continued expansion should keep it that way. Currently, the chain runs 558 cafes in 35 states. But it has plenty of room to grow out West. (Right now California has just five stores; Nevada, two; and Washington, none.) While it's unlikely that the anti-carbohydrate craze will subside in the near term (for more, see "Atkins World"), if Panera's low-carb bread, which it is currently testing in St.Louis, tastes better than cardboard, this stock may put on weight.