JPMorgan downgrades Wendy’s pending more defined strategy

JPMorgan downgraded Wendy’s (WEN) to Neutral from Overweight with a price target of $9, down from $12. The firm moves to the sidelines pending a more defined strategy from a permanent management team. Wendy’s chances of a U.S. turnaround through meaningful unit volume expansion is a “very low probability outcome” in the next three years, the analyst tells investors in a research note. Until the company can reach $2.3M-$2.5M average unit volume, above the current U.S. franchise AUVs of $1.9M, Wendy’s will have difficultly making the franchise unit economics work to restart U.S. development, contends JPMorgan.