Ask Matt: Should I drive off with Sonic stock?

Q: Should I drive off with Sonic stock?

A: Sonic is supposed to be a fast-growing player in the fast-food market. Investors are having trouble digesting the company's slowing growth.

Shares of the Oklahoma-based drive-in chain got fried 8.4% to close at $25.31 Tuesday following the company's guidance for future growth. Sonic told investors it plans to see between 2% and 4% growth from restaurants open at least a year in fiscal 2016, which ends next August. That's down from the 7.3% same-store growth the company saw in fiscal 2015.

Profits, though, appear to be on track. Sonic says it expects between 14% and 18% earnings-per-share growth in fiscal 2016. That jives with analysts' expectations calling for the company to earn an adjusted $1.26 a share in fiscal 2016, up 15.6% from expected fiscal 2015 results, according to S&P Capital IQ. Same-store sales may not be as hot as some may have hoped, but the earnings story is still there. Analysts are sticking by the stock, calling for it to be worth $36.25 a share in 18 months. If correct, that's a tasty upside of 43%. If there's a downside, its that the stock still isn't a bargain. Shares are trading for 24 times earnings over the past 12 months, which is pricey next to expected long-term growth of 16%.

Paste BN markets reporter Matt Krantz answers a different reader question every weekday. To submit a question, e-mail Matt at mkrantz@usatoday.com or on Twitter @mattkrantz.