Is Experience Overrated or Was CKE Undervalued?

“Inexperience Pays.”

That was the headline in the current Forbes magazine over an article featuring CKE Restaurants Chairman William K. Foley II, who has watched the company’s stock shoot from single digits to $28 at the time the Forbes story hit newsstands.

“Bill Foley didn’t know how to run a restaurant chain, but he learned quickly how not to run one,” according to the article “. . . Three years later you wouldn’t know that it was the same company.”

The Forbes article chronicled the Carl’s Jr. chain’s move from a failed low-cost menu strategy to a return to what it traditionally has done best--provide slightly more expensive food that many consumers see as a step above the fare served by other burger chains.

Foley took over as chairman of the Anaheim-based company in late 1993 as part of a deal that rescued chain founder Carl N. Karcher from possible bankruptcy following a string of ill-advised business deals. Foley bought a controlling block of stock from Karcher and set about trying to learn how to right the ailing chain’s financial fortunes.

Good press, it seems, also pays. CKE’s stock shot up $2 on the day after the article appeared last Thursday.

Greg Johnson covers retail businesses and restaurants for The Times. He can be reached at (714) 966-5950 and at greg.johnson@latimes.com