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Wendy's (WEN) Beats Q2 Earnings and Sales Estimates

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The Wendy's Company (WEN - Free Report) is one of the leading quick-service restaurant companies that serves hamburgers, chicken breast sandwiches and wraps, chicken nuggets, chili, baked and French fried potatoes, freshly prepared salads, soft drinks and Frosty desserts.

The company has been focusing on its system optimization initiative since 2013. The system optimization initiative is aimed at changing the business to a franchise-based model. Though the reduction in ownership is currently weighing on near-term revenues, franchising a large chunk its system is helping to lower overhead expenses. Meanwhile, sales initiatives like menu innovation, promotional offerings, international expansion of units are driving growth.

Investors should note that the consensus estimate for WEN has been moving slightly downwards over the last 60 days. Meanwhile, WEN’s earnings have been mostly strong over the past few quarters. In fact, the company posted positive earnings surprises in three of the last four quarters, with an average beat of 23.45%. Revenues too outpaced the Zacks Consensus Estimate in three of the trailing four quarters.

WENDYS CO/THE Price and EPS Surprise

WENDYS CO/THE Price and EPS Surprise | WENDYS CO/THE Quote

Currently, WEN has a Zacks Rank #3 (Hold) but that could change following Wendy’s earnings report which was just released. We have highlighted some of the key stats from this just revealed announcement below:

Earnings: WEN beats on earnings. Our consensus earnings estimate called for EPS of 9 cents per share, and the company reported EPS of 10 cents. Investors should note that these figures take out stock option expenses.

Revenues: WEN reported revenues of $382.7 million. This beat our consensus estimate of $367 billion.

Key Stats to Note: Comps at North America company-operated restaurants increased a mere 0.4% in the reported quarter.

Stock Price Impact: At the time of writing, the stock price of Wendy’s was down over 3% during the pre-market trading hours following the earnings release.

Check back later for our full write up on this WEN earnings report later!

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