El Pollo Loco (LOCO) Makes Its Way To The S&P 600 List

Headquartered in Costa Mesa, CA, El Pollo Loco Holdings, Inc. (NASDAQ:LOCO) has joined the S&P SmallCap 600 Index after the close of trading on Sep 12.

Notably, the fast-food chain has replaced American Science & Engineering Inc., which is soon to be acquired by OSI Systems, Inc. (NASDAQ:OSIS) , subject to a few approvals.

Consequent to the news release on Sep 8, the company’s shares gained over 1%. Notably, El Pollo Loco has been added to the S&P SmallCap 600 GICS (Global Industry Classification Standard) Restaurants Sub-Industry index.

This fire-roasted chicken specialist’s fresh handcrafted Mexican inspired cuisine has been driving its popularity and ensuring a steady rise in traffic.

Notably, the company reported strong second-quarter 2016 results with both earnings and sales beating the Zacks Consensus Estimate. Also, the second quarter marked the 20th consecutive quarter of positive comps, courtesy of various sales and digital initiatives.

Interestingly, menu innovation and limited time offers have been contributing to traffic. Additionally, increased focus on catering to health-conscious customers by offering customized meals without compromising on flavors should boost traffic going ahead

Meanwhile, we believe El Pollo Loco's addition to one of the most widely followed small-cap benchmarks is a key positive for the company.

Zacks Rank & Stocks to Consider

El Pollo Loco currently has a Zacks Rank #3 (Hold). Better-ranked stocks in this sector include The Children's Place, Inc. (NASDAQ:PLCE) and Urban Outfitters Inc. (NASDAQ:URBN) . Both the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Confidential from Zacks

Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>