A Panera Bread Co. sandwich and chips.
Photograph by Daniel Acker — Bloomberg via Getty Images
By Lucinda Shen
February 10, 2016

Shares of Panera have jumped 9.14% since the restaurant chain presented an energetic picture of its expansion during the company’s Tuesday earning call, alongside earnings that beat analyst estimates.

Panera (pnra) reported earnings per share at $1.88 for the fourth quarter, beating the consensus by a dime.

Analysts have also been excited about the St. Louis-based restaurant chain’s continued roll out of its digital service platform, Panera 2.0—which accounted for some of Panera’s results.

“We like that Panera continues to find ways to convert 2.0 locations in a more time- and capital-efficient manner, and that the bulk of conversions at company-owned locations will likely be completed over the next two years,” wrote R.J. Hottovy, a consumer strategist for Morningstar. He continued that it suggests “capital for future conversions will increasingly be put on franchisees—which positions Panera well for margin expansion over the medium term.”

Panera 2.0 includes introducing touch screen kiosks that can handle higher customer volume more efficiently, and counter-to-table delivery among other initiatives.

The $4.8 billion Panera plans to remodel an additional 100 company stores in 2016—adding to the 410 or-so stores already under Panera 2.0 in the company’s 901 store-system. These numbers exclude the company’s 1,071 franchisees, several of which have also converted to 2.0.

And the hallmark of Panera 2.0, it’s digital system, now accounts for 22% of sales in the remodeled cafes, according to CEO Ronald Shaich.

“We are now saying that we believe that you’ll see double-digit earnings growth in 2017,” said Shaich during the earnings call.

Investors may have also been attracted to the company’s comparable same stores sales forecast, which is expected to rise to around 3.5% to 4.5% in 2016. In contrast, stores on average increased sales by 3.3% in 2015.

Panera is also estimating a 2016 EPS growth of about 2% to 3% for the 2016 fiscal year.

Revenue missed analyst estimates, clocking in at $691.8 million versus $695.7 million.

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