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Texas Roadhouse (TXRH) Surges 3.2%: Is This an Indication of Further Gains?

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Texas Roadhouse (TXRH - Free Report) shares ended the last trading session 3.2% higher at $107.02. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 7.7% gain over the past four weeks.

Shares of Texas Roadhouse jumped after the company posted better-than-expected first quarter 2021 results, with earnings and revenues surpassing the Zacks Consensus Estimate. Notably, positive investor sentiments were witnessed as comps for the quarter exceeded pre-pandemic levels. Clearly, the company benefitted from easing of dining restrictions along with strength in its To-Go sales.

Price and Consensus

Price Consensus Chart for TXRH

This restaurant chain is expected to post quarterly earnings of $0.65 per share in its upcoming report, which represents a year-over-year change of +235.4%. Revenues are expected to be $765.58 million, up 60.7% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Texas Roadhouse, the consensus EPS estimate for the quarter has been revised 7.8% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on TXRH going forward to see if this recent jump can turn into more strength down the road.

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

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