UPDATE 1-RESEARCH ALERT-Raymond James downgrades Buffalo Wild

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June 20 (Reuters) - Buffalo Wild Wings Inc (BWLD.O) shares fell more than 8 percent after Raymond James downgraded the restaurant operator to "underperform" from "outperform" on strong valuation and rising commodity costs.

The brokerage said over the past few weeks Buffalo Wild's shares have managed to shrug off the overall weakness seen by its peers -- O'Charley's Inc (CHUX.O), Morton's Restaurant Group Inc (MRT.N) and California Pizza Kitchen Inc (CPKI.O) -- giving them a rich valuation.

Raymond James said since May 1 most of the stocks in its restaurant segment have fallen 10 percent to 20 percent till Thursday, while Buffalo Wild's shares have shown enough strength, gaining nearly 3 percent

As a result, a significant gap in valuation has opened between Buffalo Wild and its casual dining peers such as Red Robin Gourmet Burgers Inc (RRGB.O) and Texas Roadhouse Inc (TXRH.O).

Buffalo Wild trades at about 24 times forward earnings, outperforming Red Robin and Texas Roadhouse, which are trading at 15 times and 16 times, respectively.

Raymond James expects the prices of chicken wings to climb as chicken producers are hit by the recent surge in corn prices driven by crop damage from widespread flooding in the Midwest.

Shares of the operator of Buffalo Wild Wings Grill and Bar restaurants were down $2.62 at $29.74 in morning trade on Nasdaq. (Reporting by Dilipp S. Nag in Bangalore; Editing by Anil D'Silva)