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Brinker (EAT) Q3 Earnings & Revenues Top Estimates, Stock up
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Brinker International, Inc. (EAT - Free Report) reported stellar third-quarter fiscal 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. During the quarter, the company’s performance was backed by sustained advancements in enhancing the guest experience, effective marketing strategies and traffic-driving initiatives. Following the results, the stock moved up 7.9% during trading hours on Apr 30.
Earnings & Revenue Discussion
In the quarter under review, Brinker reported adjusted earnings per share (EPS) of $1.24, surpassing the Zacks Consensus Estimate of $1.15. The company reported an adjusted EPS of $1.23 in the prior-year quarter.
In the fiscal third quarter, total revenues of $1.12 billion outpaced the consensus mark of $1.11 billion. The top line increased 3.4% on a year-over-year basis. EAT gained from the solid performance of Chili's.
Brinker International, Inc. Price, Consensus and EPS Surprise
During the fiscal third quarter, revenues in the Chili’s segment rose 3.8% year over year to $999.6 million. The upside was primarily driven by increased menu pricing. However, this was partially offset by lower traffic and an unfavorable menu item mix. Our model predicted segmental revenues at $995.7 million.
Chili's restaurant expenses (as a percentage of company sales) in the fiscal third quarter were 85.9% compared with 86.8% in the prior-year quarter. The downside was caused by sales leverage, menu pricing, favorable commodity mix, lower delivery fees and to-go supplies. A rise in advertising and hourly labor expenses partially offset this.
Chili's company-owned traffic declined 1.8% year over year in the quarter. The metric fell 5.8% in the prior-year quarter.
The segment’s company-owned comps rose 3.5% in the fiscal third quarter from the year-ago quarter’s levels.
At Chili’s, domestic comps (including company-owned and franchised) rose 3.6% year over year compared with 9.1% growth reported in the prior-year period.
Maggiano’s
Maggiano’s sales in the fiscal third quarter increased 0.8% year over year to $120.7 million. Favorable comparable restaurant sales, courtesy of increased menu pricing and favorable menu item mix, primarily drove the upside. Comps in the segment rose 1.7% year over year. Our projection was 2.1%.
Traffic in the quarter fell 7.5% year over year. The metric was up 9.5% in the prior-year quarter.
Maggiano's company restaurant expenses (as a percentage of company sales) in the fiscal third quarter were 85% compared with 85.1% a year ago. The downside was caused by menu pricing partially offset by increased repairs and maintenance expenses.
Operating Results
During the quarter, total operating costs and expenses came in at $1.05 billion compared with $1.02 billion reported in the year-ago quarter. Adjusted operating margin, as a percentage of company sales, was 14.2% compared with 13.4% reported in the prior-year quarter.
Adjusted EBITDA during the fiscal third quarter came in at $122.4 million compared with $113 million reported in the prior-year quarter.
Balance Sheet
As of Mar 27, 2024, cash and cash equivalents amounted to $15.5 million compared with $13.8 million as of Mar 29, 2023.
As of Mar 27, 2024, long-term debt was $818.5 million compared with $912.2 million as of Jun 28, 2023. Total shareholders’ deficit in the reported quarter was ($46.7) million compared with ($109.5) million in the previous quarter.
Fiscal 2024 Outlook
In the fiscal 2024, management anticipates total revenues to be in the range of $4.3-$4.35 billion. Capital expenditures are expected in the $185-$195 million band. EAT projects fiscal 2024 EPS in the range of $3.8-$4, up from the prior estimate of $$3.45-$3.7.
Yum China Holdings, Inc. (YUMC - Free Report) reported impressive first-quarter 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. The upside can be attributed to robust total system sales growth and new unit contribution.
During the quarter, YUMC reported adjusted EPS of 71 cents, beating the Zacks Consensus Estimate of 66 cents. The bottom line moved up 2.9% from 69 cents reported a year ago.
Quarterly revenues of $2.96 billion outpaced the consensus mark of $2.94 billion. The top line inched up 1% on a year-over-year basis. Excluding foreign currency translation, revenues increased 7% year over year.
Chipotle Mexican Grill, Inc. (CMG - Free Report) released stellar first-quarter 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. During the quarter, the company reported benefits from enhanced throughput and effective marketing initiatives like Braised Beef Barbacoa and Chicken Al Pastor, leading to strong sales and transaction growth. The company stated that the momentum continued into April.
During the quarter, CMG reported adjusted EPS of $13.37, outpacing the Zacks Consensus Estimate of $11.63. The bottom line increased 27.3% from $10.50 reported in the year-ago quarter.
Quarterly revenues of $2.7 billion surpassed the consensus mark of $2.68 billion by 1%. The top line rose 14.1% on a year-over-year basis on the back of strong comparable restaurant sales growth and new restaurant openings.
McDonald's Corporation (MCD - Free Report) posted mixed first-quarter 2024 results, with earnings missing the Zacks Consensus Estimate and revenues beating the same. The top and the bottom line increased on a year-over-year basis.
During the quarter, MCD reported McDonald's reported adjusted EPS of $2.70, which missed the Zacks Consensus Estimate of $2.71. However, EPS increased 2% year over year.
Quarterly net revenues of $6,169 million beat the consensus mark of $6,168 million. The top line rose 5% year over year.
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Brinker (EAT) Q3 Earnings & Revenues Top Estimates, Stock up
Brinker International, Inc. (EAT - Free Report) reported stellar third-quarter fiscal 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. During the quarter, the company’s performance was backed by sustained advancements in enhancing the guest experience, effective marketing strategies and traffic-driving initiatives. Following the results, the stock moved up 7.9% during trading hours on Apr 30.
Earnings & Revenue Discussion
In the quarter under review, Brinker reported adjusted earnings per share (EPS) of $1.24, surpassing the Zacks Consensus Estimate of $1.15. The company reported an adjusted EPS of $1.23 in the prior-year quarter.
In the fiscal third quarter, total revenues of $1.12 billion outpaced the consensus mark of $1.11 billion. The top line increased 3.4% on a year-over-year basis. EAT gained from the solid performance of Chili's.
Brinker International, Inc. Price, Consensus and EPS Surprise
Brinker International, Inc. price-consensus-eps-surprise-chart | Brinker International, Inc. Quote
Chili's
During the fiscal third quarter, revenues in the Chili’s segment rose 3.8% year over year to $999.6 million. The upside was primarily driven by increased menu pricing. However, this was partially offset by lower traffic and an unfavorable menu item mix. Our model predicted segmental revenues at $995.7 million.
Chili's restaurant expenses (as a percentage of company sales) in the fiscal third quarter were 85.9% compared with 86.8% in the prior-year quarter. The downside was caused by sales leverage, menu pricing, favorable commodity mix, lower delivery fees and to-go supplies. A rise in advertising and hourly labor expenses partially offset this.
Chili's company-owned traffic declined 1.8% year over year in the quarter. The metric fell 5.8% in the prior-year quarter.
The segment’s company-owned comps rose 3.5% in the fiscal third quarter from the year-ago quarter’s levels.
At Chili’s, domestic comps (including company-owned and franchised) rose 3.6% year over year compared with 9.1% growth reported in the prior-year period.
Maggiano’s
Maggiano’s sales in the fiscal third quarter increased 0.8% year over year to $120.7 million. Favorable comparable restaurant sales, courtesy of increased menu pricing and favorable menu item mix, primarily drove the upside. Comps in the segment rose 1.7% year over year. Our projection was 2.1%.
Traffic in the quarter fell 7.5% year over year. The metric was up 9.5% in the prior-year quarter.
Maggiano's company restaurant expenses (as a percentage of company sales) in the fiscal third quarter were 85% compared with 85.1% a year ago. The downside was caused by menu pricing partially offset by increased repairs and maintenance expenses.
Operating Results
During the quarter, total operating costs and expenses came in at $1.05 billion compared with $1.02 billion reported in the year-ago quarter. Adjusted operating margin, as a percentage of company sales, was 14.2% compared with 13.4% reported in the prior-year quarter.
Adjusted EBITDA during the fiscal third quarter came in at $122.4 million compared with $113 million reported in the prior-year quarter.
Balance Sheet
As of Mar 27, 2024, cash and cash equivalents amounted to $15.5 million compared with $13.8 million as of Mar 29, 2023.
As of Mar 27, 2024, long-term debt was $818.5 million compared with $912.2 million as of Jun 28, 2023. Total shareholders’ deficit in the reported quarter was ($46.7) million compared with ($109.5) million in the previous quarter.
Fiscal 2024 Outlook
In the fiscal 2024, management anticipates total revenues to be in the range of $4.3-$4.35 billion. Capital expenditures are expected in the $185-$195 million band. EAT projects fiscal 2024 EPS in the range of $3.8-$4, up from the prior estimate of $$3.45-$3.7.
Zacks Rank
Brinker carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Retail-Wholesale Releases
Yum China Holdings, Inc. (YUMC - Free Report) reported impressive first-quarter 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. The upside can be attributed to robust total system sales growth and new unit contribution.
During the quarter, YUMC reported adjusted EPS of 71 cents, beating the Zacks Consensus Estimate of 66 cents. The bottom line moved up 2.9% from 69 cents reported a year ago.
Quarterly revenues of $2.96 billion outpaced the consensus mark of $2.94 billion. The top line inched up 1% on a year-over-year basis. Excluding foreign currency translation, revenues increased 7% year over year.
Chipotle Mexican Grill, Inc. (CMG - Free Report) released stellar first-quarter 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. During the quarter, the company reported benefits from enhanced throughput and effective marketing initiatives like Braised Beef Barbacoa and Chicken Al Pastor, leading to strong sales and transaction growth. The company stated that the momentum continued into April.
During the quarter, CMG reported adjusted EPS of $13.37, outpacing the Zacks Consensus Estimate of $11.63. The bottom line increased 27.3% from $10.50 reported in the year-ago quarter.
Quarterly revenues of $2.7 billion surpassed the consensus mark of $2.68 billion by 1%. The top line rose 14.1% on a year-over-year basis on the back of strong comparable restaurant sales growth and new restaurant openings.
McDonald's Corporation (MCD - Free Report) posted mixed first-quarter 2024 results, with earnings missing the Zacks Consensus Estimate and revenues beating the same. The top and the bottom line increased on a year-over-year basis.
During the quarter, MCD reported McDonald's reported adjusted EPS of $2.70, which missed the Zacks Consensus Estimate of $2.71. However, EPS increased 2% year over year.
Quarterly net revenues of $6,169 million beat the consensus mark of $6,168 million. The top line rose 5% year over year.