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Why Brinker International (EAT) Dipped More Than Broader Market Today

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In the latest market close, Brinker International (EAT - Free Report) reached $61.75, with a -1.41% movement compared to the previous day. The stock's change was less than the S&P 500's daily loss of 0.77%. Meanwhile, the Dow experienced a drop of 0.6%, and the technology-dominated Nasdaq saw a decrease of 1.05%.

Prior to today's trading, shares of the operator of restaurant chains Chili's Grill & Bar and Maggiano's Little Italy had lost 5.42% over the past month. This has was narrower than the Retail-Wholesale sector's loss of 7.43% and the S&P 500's loss of 5.85% in that time.

The upcoming earnings release of Brinker International will be of great interest to investors. The company's earnings report is expected on August 14, 2024. The company is predicted to post an EPS of $1.65, indicating a 18.71% growth compared to the equivalent quarter last year. At the same time, our most recent consensus estimate is projecting a revenue of $1.16 billion, reflecting a 7.68% rise from the equivalent quarter last year.

Investors should also note any recent changes to analyst estimates for Brinker International. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 5.42% increase. Brinker International presently features a Zacks Rank of #1 (Strong Buy).

From a valuation perspective, Brinker International is currently exchanging hands at a Forward P/E ratio of 13.23. This expresses a discount compared to the average Forward P/E of 19.47 of its industry.

Also, we should mention that EAT has a PEG ratio of 0.62. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Retail - Restaurants industry held an average PEG ratio of 1.96.

The Retail - Restaurants industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 185, which puts it in the bottom 27% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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