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Red Robin (RRGB) Introduces 3 New Delivery-Only Brands

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Red Robin Gourmet Burgers, Inc. (RRGB - Free Report) continues to strengthen its delivery program to drive off-premise sales. The company recently announced the rollout of three new delivery-only brands — Chicken Sammy's, The Wing Dept. and Fresh Set.

The brands will provide items from Red Robin as well as new products that are not available on the menu. The company is planning to invest more in these virtual brands and add more menu items in the future.

The Wing Dept. offers a variety of wings and sides, while Fresh Set provides a wide array of fresh green salads, wraps and sandwiches. Meanwhile, Chicken Sammy’s provides a range of chicken sandwiches, chicken tenders, homemade kettle chips and more.

The launch of these three new delivery-only brands follows the company’s partnership with Donatos Pizza. In 2018, Donatos Pizza was available at select Red Robin locations. The company is planning to expand this program to 120 more locations in 2021.

Paul Murphy, Red Robin president and CEO said “We were pleased with the great feedback we received from Guests when we tested the delivery-only brands. We plan to continue to invest in these new virtual brands and will be introducing new craveable menu items for each brand soon."

Red Robin has been investing more in technology and data infrastructure. The company is set to grow its off-premise, online-ordering business via carry-out, delivery and catering. The growing demand for off-premise orders has been resulting in higher traffic.

Shares of the company have surged 180.1% in the past six months, compared with the industry’s rally of 11.1%.

Off-Premise Sales Major Growth Drivers

The company’s off-premise sales have increased sharply compared with the pre-COVID-19 levels. During the second, the third and the fourth quarter of 2020, off-premise sales soared 208.7%, 127.2%, and 131.8%, respectively. The off-premise sales comprised 63.8%, 40.7% and 43.9% of total food and beverage sales in the second, the third and the fourth quarter of 2020, respectively. Notably, the upside can primarily be attributed to its process and technology enhancements, and the implementation of triple check accuracy program. Also, reductions in menu and refined operating processes resulted in the accuracy of timely pickup and delivery.

Zacks Rank

Red Robin — shares space with Brinker International, Inc. (EAT - Free Report) , Papa John's International, Inc. (PZZA - Free Report) and Chipotle Mexican Grill, Inc. (CMG - Free Report) in the Zacks Retail – Restaurants industry — currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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