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BJ's Restaurants Builds Momentum With Traffic Despite Cost Pressures
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Key Takeaways
BJRI expanded restaurant-level margins to 12.5% as operating profit rose 8.8% on efficiency gains.
BJRI is driving guest engagement with menu innovation that lifts check averages and brand visibility.
BJRI continues to face food cost inflation and limited international exposure, pressuring growth outlook.
BJ's Restaurants, Inc. (BJRI - Free Report) has been benefiting from increased traffic growth, improved operational efficiency and effective marketing execution. In addition, its AI-driven activity-based labor model, ongoing remodeling initiatives and higher guest satisfaction continue to support the company’s long-term, sustainable growth trajectory.
Shares of this premium casual restaurant chain have gained 36% in the past three months, outperforming the Zacks Retail - Restaurants industry’s 2.7% rise. Its earnings topped the Zacks Consensus Estimate in each of the trailing four quarters, the average being 155.6%.
Image Source: Zacks Investment Research
The earnings estimate for 2025 has moved up to $2.19 per share from $2.14 over the past 60 days. Despite operating efficiencies and margin improvement, elevated costs, potential tariff-related risks and ongoing inflationary pressures continue to cloud the outlook.
BJ's Restaurants — a Zacks Rank #3 (Hold) stock — has a favorable VGM Score of A. Let’s take a closer look at the key factors supporting the stock’s performance and the challenges that may hold it back.
Factors Fueling Growth of BJRI Stock
Sales-Building & Margin-Driving Initiatives: BJ’s Restaurants is driving growth through sales-building initiatives while advancing its strategic priorities. The company continues to see solid engagement from seasonal menu offerings and social-led marketing campaigns, which have meaningfully enhanced brand visibility and support its long-term shareholder value creation strategy.
In the third quarter of 2025, BJ’s Restaurants posted 0.5% year-over-year comparable sales growth, driven by a 3.3% increase in guest traffic. From a profitability standpoint, restaurant-level operating margins expanded to 12.5%, while adjusted EBITDA margins reached 6.4%, reflecting year-over-year improvements of 80 and 70 basis points, respectively. Restaurant-level operating profit rose 8.8% to $41.3 million, marking the company’s profitable quarter and underscoring its ability to balance growth investments, margin expansion and capital returns.
Focus on Menu Innovation: BJ's Restaurants is moving on with its long-term growth plan by continuing to come up with new menu items, with a particular focus on bringing some of the old platforms back to life. The company recently rolled out its latest menu update, with the Spooky Pizookie emerging as a social-media-driven success, generating significant guest engagement and brand visibility. The 22-ounce beer pour has achieved an approximately 23% pickup rate, supporting higher check averages through increased beer attachment.
The Brewhouse Sampler has become a top-three appetizer, resonating well with the guests. Looking ahead, BJ’s Restaurants is preparing for the nationwide rollout of its revamped pizza platform in the fourth quarter of 2025, featuring Detroit-style-inspired dough. Additionally, the introduction of the All-American Smash Burger as a new feature within the Pizookie Meal Deal generated more than 2 billion impressions on National Cheeseburger Day alone. Collectively, these initiatives reinforce the company’s focus on strengthening the guest experience while supporting sustainable long-term growth.
Remodeling Efforts: BJ's Restaurants is progressively moving forward with its expansion plans by taking a balanced approach to both new unit construction and remodels. The company is actively working on initiatives to increase sales by prioritizing guests’ dining experience. By year-end 2025, BJRI expects to complete 20 remodels, bringing the three-year total to 72 locations and covering about half of its pre-2016 base, with consistently value-accretive results. In 2026, the company plans to continue remodel investments while piloting a refreshed prototype to support future portfolio growth and maintain a modern dining atmosphere.
Factor Hindering Growth
Inflationary Pressure: BJ’s Restaurants continues to navigate a challenging cost environment marked by persistent inflationary pressures, particularly in food commodities. During the third quarter of 2025, management noted approximately 2% year-over-year food cost inflation, caused primarily by higher beef and seafood costs, partially offset by lower bone-in chicken prices. Looking ahead, management expects overall inflation to step up modestly in the fourth quarter, moving from roughly 2% in the third quarter to the mid-2% range.
Top-Ranked Stocks
Some top-ranked stocks from the Zacks Retail-Wholesale sector are:
El Pollo Loco Holdings, Inc. (LOCO - Free Report) presently sports a Zacks Rank #1 (Strong Buy). The company delivered a trailing four-quarter earnings surprise of 19.6%, on average. LOCO stock has fallen 2.9% in the past six months. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for LOCO’s 2026 sales and EPS indicates growth of 1.3% and 4.2%, respectively, from the year-ago period’s levels.
Dillard's, Inc. (DDS - Free Report) flaunts a Zacks Rank of 1 at present. The company delivered a trailing four-quarter earnings surprise of 26.5%, on average. DDS stock has rallied 50.3% in the past six months.
The Zacks Consensus Estimate for Dillard’s fiscal 2026 sales indicates growth of 1.3%, while EPS indicates a decline of 10% from the year-ago period’s levels.
Expedia Group, Inc. (EXPE - Free Report) flaunts a Zacks Rank of 1 at present. The company delivered a trailing four-quarter earnings surprise of 4.5%, on average. EXPE stock has surged 70.9% in the past six months.
The Zacks Consensus Estimate for EXPE’s 2026 sales and EPS indicates growth of 6.3% and 20.9%, respectively, from the prior-year levels.
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BJ's Restaurants Builds Momentum With Traffic Despite Cost Pressures
Key Takeaways
BJ's Restaurants, Inc. (BJRI - Free Report) has been benefiting from increased traffic growth, improved operational efficiency and effective marketing execution. In addition, its AI-driven activity-based labor model, ongoing remodeling initiatives and higher guest satisfaction continue to support the company’s long-term, sustainable growth trajectory.
Shares of this premium casual restaurant chain have gained 36% in the past three months, outperforming the Zacks Retail - Restaurants industry’s 2.7% rise. Its earnings topped the Zacks Consensus Estimate in each of the trailing four quarters, the average being 155.6%.
Image Source: Zacks Investment Research
The earnings estimate for 2025 has moved up to $2.19 per share from $2.14 over the past 60 days. Despite operating efficiencies and margin improvement, elevated costs, potential tariff-related risks and ongoing inflationary pressures continue to cloud the outlook.
BJ's Restaurants — a Zacks Rank #3 (Hold) stock — has a favorable VGM Score of A. Let’s take a closer look at the key factors supporting the stock’s performance and the challenges that may hold it back.
Factors Fueling Growth of BJRI Stock
Sales-Building & Margin-Driving Initiatives: BJ’s Restaurants is driving growth through sales-building initiatives while advancing its strategic priorities. The company continues to see solid engagement from seasonal menu offerings and social-led marketing campaigns, which have meaningfully enhanced brand visibility and support its long-term shareholder value creation strategy.
In the third quarter of 2025, BJ’s Restaurants posted 0.5% year-over-year comparable sales growth, driven by a 3.3% increase in guest traffic. From a profitability standpoint, restaurant-level operating margins expanded to 12.5%, while adjusted EBITDA margins reached 6.4%, reflecting year-over-year improvements of 80 and 70 basis points, respectively. Restaurant-level operating profit rose 8.8% to $41.3 million, marking the company’s profitable quarter and underscoring its ability to balance growth investments, margin expansion and capital returns.
Focus on Menu Innovation: BJ's Restaurants is moving on with its long-term growth plan by continuing to come up with new menu items, with a particular focus on bringing some of the old platforms back to life. The company recently rolled out its latest menu update, with the Spooky Pizookie emerging as a social-media-driven success, generating significant guest engagement and brand visibility. The 22-ounce beer pour has achieved an approximately 23% pickup rate, supporting higher check averages through increased beer attachment.
The Brewhouse Sampler has become a top-three appetizer, resonating well with the guests. Looking ahead, BJ’s Restaurants is preparing for the nationwide rollout of its revamped pizza platform in the fourth quarter of 2025, featuring Detroit-style-inspired dough. Additionally, the introduction of the All-American Smash Burger as a new feature within the Pizookie Meal Deal generated more than 2 billion impressions on National Cheeseburger Day alone. Collectively, these initiatives reinforce the company’s focus on strengthening the guest experience while supporting sustainable long-term growth.
Remodeling Efforts: BJ's Restaurants is progressively moving forward with its expansion plans by taking a balanced approach to both new unit construction and remodels. The company is actively working on initiatives to increase sales by prioritizing guests’ dining experience. By year-end 2025, BJRI expects to complete 20 remodels, bringing the three-year total to 72 locations and covering about half of its pre-2016 base, with consistently value-accretive results. In 2026, the company plans to continue remodel investments while piloting a refreshed prototype to support future portfolio growth and maintain a modern dining atmosphere.
Factor Hindering Growth
Inflationary Pressure: BJ’s Restaurants continues to navigate a challenging cost environment marked by persistent inflationary pressures, particularly in food commodities. During the third quarter of 2025, management noted approximately 2% year-over-year food cost inflation, caused primarily by higher beef and seafood costs, partially offset by lower bone-in chicken prices. Looking ahead, management expects overall inflation to step up modestly in the fourth quarter, moving from roughly 2% in the third quarter to the mid-2% range.
Top-Ranked Stocks
Some top-ranked stocks from the Zacks Retail-Wholesale sector are:
El Pollo Loco Holdings, Inc. (LOCO - Free Report) presently sports a Zacks Rank #1 (Strong Buy). The company delivered a trailing four-quarter earnings surprise of 19.6%, on average. LOCO stock has fallen 2.9% in the past six months. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for LOCO’s 2026 sales and EPS indicates growth of 1.3% and 4.2%, respectively, from the year-ago period’s levels.
Dillard's, Inc. (DDS - Free Report) flaunts a Zacks Rank of 1 at present. The company delivered a trailing four-quarter earnings surprise of 26.5%, on average. DDS stock has rallied 50.3% in the past six months.
The Zacks Consensus Estimate for Dillard’s fiscal 2026 sales indicates growth of 1.3%, while EPS indicates a decline of 10% from the year-ago period’s levels.
Expedia Group, Inc. (EXPE - Free Report) flaunts a Zacks Rank of 1 at present. The company delivered a trailing four-quarter earnings surprise of 4.5%, on average. EXPE stock has surged 70.9% in the past six months.
The Zacks Consensus Estimate for EXPE’s 2026 sales and EPS indicates growth of 6.3% and 20.9%, respectively, from the prior-year levels.