The stock price of Wendy’s Co (WEN) has gone up by over 1.51% today till the late morning trading session. The stock closed at $10.62 on Tuesday.
The Ohio based company is an American international fast food restaurant chain founded by Dave Thomas on November 15, 1969, in Columbus, Ohio, United States. As of 2016, Wendy’s was the world’s third largest hamburger fast food chain with 6,490 locations, following Burger King’s 15,003 locations and McDonald’s’ 36,525 locations. On April 24, 2008, the company announced a merger with Triarc Companies Inc., a publicly traded company and the parent company of Arby’s. Despite the new ownership, Wendy’s headquarters remained in Dublin. Previously, Wendy’s had rejected more than two buyout offers from Triarc. Following the merger, Triarc became known as Wendy’s/Arby’s Group, and later as The Wendy’s Company.
As of January 3, 2016, there were a total of 6,479 locations, including 632 that are company-owned. Approximately 85% of Wendy’s restaurants (or 5,847 locations) are franchised, and 77% of them are located in North America. Wendy’s and its affiliates employ more than 47,000 people in its global operations. In fiscal year 2006, the firm had $2.469 billion (USD) in total sales. While Wendy’s sets standards for exterior store appearance, food quality and menu, individual owners have control over hours of operations, interior decor, pricing and staff uniforms and wages.
Meanwhile, the Coalition of Immokalee Workers (CIW) – an internationally renowned farm worker group (and leading early labor ally of one former presidential candidate)—is leading a nationwide boycott of Wendy’s, to pressure the fast-food giant to participate in a “worker-led social responsibility” system that links corporate accountability with labor justice from farm to table.
CIW farmworker-member Julia De La Cruz spoke from a recent summit of activists in Florida, where community groups strategised on the nationwide boycott: “Wendy’s is continuing to profit from the sweat of workers and not acknowledging the work that we do. They don’t even want a dialogue with us. And what we’re to make them do is take responsibility for the workers in their supply chain.”
Although other brands like Whole Foods and Subway have been pressured to sign on to CIW’s Fair Food program, Wendy’s has issued its own corporate social-responsibility code, presented in a glossy 20-page booklet that workers say is full of empty promises.
Wendy’s states that “Suppliers are expected to fairly compensate and provide wages, benefits and overtime premiums to their employees that comply with applicable laws and regulations.” Notably, the plan does not layout general rules for fair labor conditions beyond the legal minimum, without mandating direct sanctions for suppliers who fail to meet the company’s “expectations.” CIW rejects the softer language, insisting on its own system of regular auditing under a worker-led monitoring program, which ties corporate membership in the program to a system of sanctions for violations.
Our analysts have given a “HOLD” rating to Wendy’s stock. Today’s rise indicates a positive response from the market, however the drop yesterday makes it risky to buy it as of now and hence the current holders of this stock are advised to hold it.