Good news for surf and turf lovers. The feast in those scrumptious restaurant stocks, up an average 170% since March 2003, is far from over.

That’s the four-star stock review from a couple of restaurant-tracking specialists at Jefferies & Co., Donald Trott, who heads up the consumer sector, and analyst Aimee Marcel.

Among their favorite delicacies are two upscale restaurant chains, each of which has a Big Apple location. They are Morton’s Restaurant Group ($17.20), principally steakhouses, where a porterhouse will run you $44.95, and McCormick & Schmick’s Seafood ($25.98), a dining establishment for seafood lovers where lobsters go for $32 a pound.

Looking 18 months out, our two restaurant trackers see Morton’s at about $30 and McCormick at $33.

Wall Street’s swelling appetite for restaurant stocks is not unexpected. It reflects a number of positive trends, which, in turn, are leading to a record number of Americans dining out. Among them: growing disposable income, a strengthening jobs market, and a surging number of working mothers in the labor force.

Mr. Trott regards upscale restaurants such as Morton’s and McCormick, each with a strong franchise, as much more appetizing than the popular-priced mass-market casual dining establishments since they’re not as intensely competitive. Further, he points out, excess capacity is already starting to build at the mass-market level.

Now for some specifics about Jefferies’ steak and seafood combo. Morton’s, which runs 69 restaurants, four of which are large popular-priced Italian eateries known as Bertolini’s, is thought to have the prospects to expand to between 150 to 175 outlets nationally. The typical Morton’s unit earns about $4 million a year; Bertolini’s, $11 million.

Some major Morton’s pluses, according to our two bulls:

* An enticing valuation, what with Morton’s trading at a significant discount to other upscale restaurant stocks – namely 16 to 17 times estimated 2007 earnings, versus more than 20 for its peers.

* Substantial high-end corporate appeal.

* Bar renovation, which it is felt could turn this phase of the business into a bigger moneymaker. About five have been remodeled so far, resulting in an average sales jump of 40% in these units.

* Boardroom expansion. Basically, private dining rooms that seat between six and 50 diners, which fetch a bigger check, are being aggressively expanded as a way to fatten sales. The average check per person at Morton’s runs $87; in the boardrooms, the check averages $101.

Over the next five years, Morton’s, according to our two restaurant experts, should average per-share earnings growth of 15% to 20% a year.

Last year, the steakhouse chain earned 55 cents a share on sales of about $300 million. This year’s net is pegged at 71 cents a share on revenues of $312 million. Next year’s outlook calls for $1.01 a share on sales of $357 million.

Even faster earnings growth, of 19% to 20% a year, is envisioned for Mc-Cormick over the next five years. The chain, which numbers 63 restaurants, is viewed as the nation’s leading affordable seafood chain, with an average check running $22 for lunch and $49.50 for dinner. A potential for 150 to 200 such restaurants is seen nationally.

In 2005, McCormick earned 78 cents a share on revenues of $279 million. This year, including a 60 cents a share charge for expensing stock options, earnings are projected at 87 cents on sales of $314 million. Next year, $1.04 is the estimate on revenues of $367 million.

One significant plus, Mr. Trott notes, is McCormick’s steady price adjustments, enabling the company to exercise more effective control over its costs (primarily food and labor) as a percentage of sales.

Its valuation (23 times estimated 2007 earnings), he points out, is not pounding-table cheap, but it is cheap relative to the multiple (30) of high growth restaurants.

The bottom line: Try M and M (Morton’s and McCormick) on your investment menu: You’ll like the financial taste.

dandordan@aol.com