Consumer spending on outdoor dining is soaring post-pandemic, propelling several Zacks Retail-Restaurants stocks to record highs. The trend, coupled with upward earnings revisions, hints at more prosperous days ahead for investors eyeing this sector’s sizzling performance.
Steaming Ahead: Brinker International
Amidst an impressive +48% surge year-to-date, Brinker International serves as an attractive investment proposition. Despite hitting a 52-week high at $64 per share, the company’s stock remains undervalued, trading at a forward earnings multiple of 15.9X – a notable discount compared to industry and S&P 500 averages. Earnings estimates for fiscal 2024 and FY25 have seen a 6% spike in the last month, projecting substantial growth for the company.
Soaring High: Wingstop
Wingstop, with a remarkable YTD growth of +49%, continues to dazzle investors with its impressive financial performance. Buoyed by a 27% increase in projected total sales this year and a subsequent 17% surge in FY25 to $685.82 million, the company is on track for substantial gains. Earnings estimates for FY24 and FY25 have soared by 13% in the past 60 days, reflecting a promising growth trajectory.
Flourishing Momentum: CAVA Group
Investors are turning their heads towards Cava Group, a Mediterranean-style food chain, driven by its robust sales projections for FY24 and FY25. With buy ratings in place and an “A” Zacks Style Scores grade for Momentum, the company is rapidly gaining popularity. Earnings estimates, up by 19% this year and a projected 34% increase in FY25 to $0.33 per share, highlight CAVA’s solid growth prospects.
Concluding Thoughts
Wingstop and Cava Group are making waves in the restaurant industry, while Brinker International’s steady expansion and appealing valuation amplify its investment appeal. Seize the opportunity to invest in these high-flying retail-restaurant stocks, as the summer outdoor dining boom augurs well for their future profitability in 2024 and beyond.