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White Hutchinson Leisure & Learning Group, Kansas City, MO, USA

Own Part of an FEC Chain for $50

OK, maybe we're stretching the point slightly, but you can own part of a 25-year-old, very successful cheesy FEC chain for only $50. That's the price of one share of stock of the chain parents loathe as a drain on their brains and wallets, but kids know and love. Haven't guessed it? The stock symbol on the New York stock exchange is CEC. That's right, Chuck E. Cheese's, the chain of 440 pizza, games and animatronics eateries parents know as birthday party hell.

Perhaps we're being a little hard on the rat. Or is it a mouse? It's only human nature to poke a little fun at success. Without a doubt, not only is Chuck E. Cheese's the oldest and most successful chain in the location-based entertainment industry (the restaurant pizza industry claims it, also), but it continues to grow. The company just reported record sales and earnings for the 3rd quarter of 2003, as well as for the first 9 months of the year. Chuck E. Cheese's stock trades at a price-earnings ratio of 19 compared to 28 for the restaurant industry and 25 for the S&P 500. That could make it a good buy. Some analysts see CEC's earnings growing 15% annually over the next few years, at least as long as indulgent parents continue to entertain the noise and grease.

Sure, Chuck E. Cheese's is the antithesis of children's edutainment centers we promote. We believe there is plenty of room in the industry for both concepts, for children's entertainment, maybe we should say eatertainment, as well as children's edutainment accompanied by greaseless upscale parent cafes. Our research shows the two concepts appeal to two completely different socio-economic groups of families. In fact, our CEO and Editor, Randy White, owns a 100 shares of CEC stock -- gee, is that a conflict of interest? Will the SEC be investigating? Is this the next big scandal after Enron? We don't think so, but we are providing full disclosure here just to be safe.

Nevertheless, with the exception of Dave & Buster's, Chuck E. Cheese's is the only publicly traded FEC-type stock we are aware of that you can purchase. You might find it an attractive opportunity if you can't afford an entire FEC. And if you can afford an entire FEC, please give us a call to discuss how we can help you develop it to be successful and competitive with Chuck E Cheese's. Heck, Randy White might even be willing to sell his CEC stock if you feel that is a conflict!

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