Back to top

Image: Bigstock

BJ's Restaurants (BJRI) Q2 Earnings Beat Estimates, Stock Up

Read MoreHide Full Article

BJ's Restaurants, Inc. (BJRI - Free Report) reported second-quarter 2020 results, wherein earnings and revenues surpassed the Zacks Consensus Estimate. However, the metrics declined on a year-over-year basis.

Following the announcement, shares of BJ's Restaurants gained 11.6% during after-hour trading session on Jul 23. Notably, investors showed confidence in the company’s operating model along with its ability to drive efficiencies through restaurants.

Earnings & Revenues

Adjusted net loss of 99 cents per share was narrower than the Zacks Consensus Estimate of a loss of $1.81. In the year-ago period, the company had reported adjusted earnings of 68 cents per share.
 

BJs Restaurants, Inc. Price, Consensus and EPS Surprise

 

BJs Restaurants, Inc. Price, Consensus and EPS Surprise

BJs Restaurants, Inc. price-consensus-eps-surprise-chart | BJs Restaurants, Inc. Quote

Total quarterly revenues of $128 million beat the consensus estimate of $126 million by 1.3%. However, the top line declined 57.5% on a year-over-year basis. Lower comparable restaurant sales led to the decline. However, total restaurant operating weeks increased approximately 1.3% from the prior-year quarter. Comparable restaurant sales declined 57.2% against 2% growth in the year-ago quarter.

Expenses & Operating Margins

Labor costs, as a percentage of sales, increased 420 basis points (bps) year over year to 40.2%. Occupancy and operating costs (as a percentage of sales) were 35.8% compared with 21.4% in the year-ago quarter. General and administrative expenses (as a percentage of sales) increased 600 bps to 11.3% in the quarter.

Restaurant-level operating margin came in at (1%) against 17% in the year-ago quarter.

Store Count

Throughout May and June, BJ’s Restaurants reopened majority (or 95%) of its dining rooms with capacity limitations. However, entering July, counties across California ordered rollbacks of their dine-in re-opening plans. Resultantly, 70% of its dining rooms are operating with limited capacity.

With respect to unit expansion, BJ's Restaurants chief executive officer, Greg Trojan stated, “While we have canceled or delayed all but one of our remaining new restaurant openings for fiscal 2020 due to the effects of the COVID-19 pandemic, we remain confident in the long-term opportunity to expand the BJ’s concept to at least 425 restaurants nationally.”

As of Jun 30, 2020, BJ’s Restaurants owned and operated 209 casual dining restaurants (in 29 states), out of which one is temporarily closed due to the COVID-19 crisis.

Balance Sheet

As of Jun 30, 2020, cash and cash equivalents totaled $86.7 million compared with $22.4 million on Dec 31, 2019. Total debt increased to $166.8 million as of Jun 30, 2020, from $143 million at 2019-end.

Zacks Rank & Key Picks

BJ's Restaurants currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the same space include Dine Brands Global, Inc. (DIN - Free Report) , Papa John's International, Inc. (PZZA - Free Report) and Yum China Holdings, Inc. (YUMC - Free Report) , each sporting a Zacks Rank #1.

Earnings in 2021 for Dine Brands are expected to surge 206.6%.

Papa John's has a three to five-year earnings per share growth rate of 8%.

Yum China has a trailing four-quarter earnings surprise of 62.9%, on average.

Zacks’ Single Best Pick to Double

From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.

With users in 180 countries and soaring revenues, it’s set to thrive on remote working long after the pandemic ends. No wonder it recently offered a stunning $600 million stock buy-back plan.

The sky’s the limit for this emerging tech giant. And the earlier you get in, the greater your potential gain.

Click Here, See It Free >>

Published in