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Red Robin (RRGB) Comps Improve on Outdoor Seating Expansion

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Red Robin Gourmet Burgers, Inc. (RRGB - Free Report) has reported preliminary comparable restaurant sales for the six weeks ended Sep 6, 2020.

Preliminary Comparable Sales

Red Robin has been witnessing sequential improvement in sales through the six weeks ended Sep 6, 2020.

For the weeks ended Aug 2, Aug 9, Aug 16, Aug 23, Aug 30 and Sep 6, comparable restaurant revenues fell 35.4%, 32.9%, 30.6%, 26.1%, 22.1% and 21.9%, respectively.

Meanwhile, 85% (or 349 dining rooms) company-operated restaurants have been reopened as of Sep 6, 2020.

Notably, the company has been witnessing improvement in comparable sales on the back of expanded seating capacity, primarily through outdoor dining. Also, strong off-premise sales through carryout and third-party delivery are adding to the positives.

Nonetheless, the company intends to maintain the momentum by implementing seating expansion in all-weather tents and booth partitions by early fourth-quarter fiscal 2020. Also, indoor dining re-openings in California are likely to benefit the company going forward.

So far this year, shares of Red Robin have plummeted 63.3% against the industry’s 3.9% growth.

Other Updates

As on Sep 6, 2020, the company reported liquidity of approximately $104 million, inclusive of cash and borrowing capacity.

Zacks Rank & Key Picks

Red Robin currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the same space include Brinker International, Inc. (EAT - Free Report) , Darden Restaurants, Inc. (DRI - Free Report) and Dave & Buster's Entertainment, Inc. (PLAY - Free Report) . Brinker sports a Zacks Rank #1, while Darden and Dave & Buster's carry a Zacks Rank #2 (Buy).

Brinker has a three-five year earnings per share growth rate of 11.4%.

Darden has a trailing four-quarter earnings surprise of 8.1%, on average.

Dave & Buster's fiscal 2022 earnings are expected to surge 108.3%.

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