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Analyst Expects Restaurants to Suffer from Swine Flu Outbreak

According to the report, analyst Jason West said in a note to investors that unlike other outbreaks, such as SARS and avian flu, which were centered in Asia, the swine flu has hit closer to home. So far, more than 100 cases have been reported in the U.S.

West said Texas Roadhouse Inc. may be one of the hardest hit chains, since 20 percent of its company-owned restaurants are located in Texas, just across the border from Mexico - considered the epicenter of the outbreak. The company also has limited takeout and no drive-through business, meaning potential customers who do not want to eat in the dining area will have fewer alternatives.

Most restaurant chains have yet to say that the outbreak is affecting their sales, according to AP’s coverage. Burger King Holdings Inc. became one of the first, saying Wednesday it is being hurt by the closure of its dining rooms in all of its 118 restaurants in the Mexico City area. Burger King cut its full-year profit outlook, partly because of potential sales declines related to swine flu.

Shares of Texas Roadhouse Inc. fell 26 cents, or 2.2 percent, to $11.46 in afternoon trading while shares of Burger King slipped 35 cents, or 2.1 percent, to $16.19.

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