We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Texas Roadhouse (TXRH - Free Report) is a full-service, casual dining restaurant chain known for its seasoned and aged steaks that are hand cut daily, and rustic, Texas-themed laidback décor. The company currently has 540 company-owned locations and another 97 franchised stores primarily in suburban and rural areas throughout the U.S.
Q3 Earnings Recap
Diluted earnings of $0.75 per share missed the Zacks Consensus Estimate of $0.81 per share, but the bottom-line figure increased 79.3% and 43.6% compared to 2020 and 2019, respectively.
Total revenue hit $868.9 million. Comparable restaurant sales were solid, growing 30.2% and 22.3% compared to 2020 and 2019, while average weekly sales at company restaurants were $120,094 *15.1% were to-go sales).
However, the increase in comps was partially offset by higher food and beverage costs driven by commodity inflation of 13.9% (this was primarily related to higher beef costs).
“There is no doubt that our industry is being challenged in a number of ways including higher food costs, supply chain shortages, and a tight labor market. We are managing through these pressures and staying committed to our long-term fundamentals," said CEO Jerry Morgan.
Bottom Line
TXRH is now a Zacks Rank #5 (Strong Sell).
Seven analysts have cut their full year earnings outlook over the past 60 days. Texas Roadhouse’s bottom line is actually expected to increase over 684% year-over-year (likely reflecting a pandemic-related bump), but the consensus estimate has fallen $0.18 to $3.53 per share for fiscal 2021. Next year’s earnings consensus has dropped as well, with six analysts lowering their forecast.
Shares have traded choppily so far in 2021. Year-to-date, TXRH is up about 12.3% compared to the S&P 500’s gain of 23+%.
Following the release of its Q3 earnings, Texas Roadhouse was hit by a slew of price target cuts. Analysts at BMO Capital, BTIG, Morgan Stanley, and Credit Suisse all lowered their targets, citing negative margin impacts from commodity and labor inflation. These challenges will likely persist into 2022, so those interested in TXRH should be prepared for more ups and downs.
Those who are interested in adding an industry peer to their portfolio could consider McDonald’s (MCD - Free Report) . MCD is a #2 (Buy) on the Zacks Rank. 10 analysts have raised their bottom-line outlook for the current fiscal year, and earnings are set to grow more than 54% year-over-year.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Bear of the Day: Texas Roadhouse (TXRH)
Texas Roadhouse (TXRH - Free Report) is a full-service, casual dining restaurant chain known for its seasoned and aged steaks that are hand cut daily, and rustic, Texas-themed laidback décor. The company currently has 540 company-owned locations and another 97 franchised stores primarily in suburban and rural areas throughout the U.S.
Q3 Earnings Recap
Diluted earnings of $0.75 per share missed the Zacks Consensus Estimate of $0.81 per share, but the bottom-line figure increased 79.3% and 43.6% compared to 2020 and 2019, respectively.
Total revenue hit $868.9 million. Comparable restaurant sales were solid, growing 30.2% and 22.3% compared to 2020 and 2019, while average weekly sales at company restaurants were $120,094 *15.1% were to-go sales).
However, the increase in comps was partially offset by higher food and beverage costs driven by commodity inflation of 13.9% (this was primarily related to higher beef costs).
“There is no doubt that our industry is being challenged in a number of ways including higher food costs, supply chain shortages, and a tight labor market. We are managing through these pressures and staying committed to our long-term fundamentals," said CEO Jerry Morgan.
Bottom Line
TXRH is now a Zacks Rank #5 (Strong Sell).
Seven analysts have cut their full year earnings outlook over the past 60 days. Texas Roadhouse’s bottom line is actually expected to increase over 684% year-over-year (likely reflecting a pandemic-related bump), but the consensus estimate has fallen $0.18 to $3.53 per share for fiscal 2021. Next year’s earnings consensus has dropped as well, with six analysts lowering their forecast.
Shares have traded choppily so far in 2021. Year-to-date, TXRH is up about 12.3% compared to the S&P 500’s gain of 23+%.
Following the release of its Q3 earnings, Texas Roadhouse was hit by a slew of price target cuts. Analysts at BMO Capital, BTIG, Morgan Stanley, and Credit Suisse all lowered their targets, citing negative margin impacts from commodity and labor inflation. These challenges will likely persist into 2022, so those interested in TXRH should be prepared for more ups and downs.
Those who are interested in adding an industry peer to their portfolio could consider McDonald’s (MCD - Free Report) . MCD is a #2 (Buy) on the Zacks Rank. 10 analysts have raised their bottom-line outlook for the current fiscal year, and earnings are set to grow more than 54% year-over-year.