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SAN FRANCISCO, Feb 8 (Reuters) - Buffalo Wild Wings' shares rose on Wednesday as some investors bet that its dismal quarterly results have strengthened the hand of an activist hedge fund in a proxy fight aimed at turning around the struggling restaurant chain.
Hedge fund manager Mick McGuire this week nominated himself and three other people to serve on the board of the company, which late on Tuesday reported quarterly earnings and sales significantly below analysts' expectations.
Hurt by rising wages and higher chicken wings prices, the restaurant chain's earnings per share have missed analysts' average expectations in six of the past eight quarters.
Lackluster interest in watching professional sports may also be hurting sports bars and restaurants, with ratings for the National Football League's most recent season down 9 percent.
Several analysts lowered their price targets and future earnings estimates for Buffalo Wild Wings following the report, and its stock opened 5 percent lower on Wednesday. But it quickly rebounded and traded up 2 percent at $152.80 at mid-day.
McGuire's San Francisco-based hedge fund owns about 5.2 percent of Buffalo Wild's shares and has asked for management to overhaul how it allocates capital and add people with relevant restaurant and finance experience to its management and board ranks.
Maxim Group analyst Stephen Anderson cut his price target for Buffalo Wild Wings to $145 from $155, and he said he would have cut it further, if not for McGuire's fight for seats on the board.
"It's only four people on a nine-person board. So even if everyone were to gain a seat on the board, it would not constitute a majority. But they could exercise some outsized influence," Anderson said.
Turning more of the eatery's restaurants over to franchisees is a central component of McGuire's plan for change at Buffalo Wild Wings and instrumental in his statement that the company's share price could triple if a number of changes were made.
The stock is down about 1 percent in 2017, compared with the S&P 500's 2-percent rise. (Reporting by Noel Randewich; Editing by Marguerita Choy)