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Red Robin (RRGB) to Report Q2 Earnings: What's in Store?
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Red Robin Gourmet Burgers, Inc.’s (RRGB - Free Report) loss is likely to widen year over year when the company reports second-quarter fiscal 2024 results. In the last reported quarter, the company delivered a negative earnings surprise of 95.1%.
How are Estimates Placed?
The Zacks Consensus Estimate is pegged at a loss of 41 cents per share. In the prior-year quarter, RRGB reported a loss per share of 24 cents.
The consensus mark for revenues is pegged at $295.6 million, suggesting a drop of 1% year over year.
Red Robin Gourmet Burgers, Inc. Price and EPS Surprise
Let's look at how things have shaped up in the quarter.
Factors at Play
Revenues
RRGB's fiscal second-quarter top line is expected to have declined year over year due to a decline in comparable restaurant revenues caused by a shift away from deep discounting marketing promotions and dismal guest traffic.
For second-quarter fiscal 2024, our models predict comparable restaurant revenues to decline 5.5% against an increase of 1.5% in the year-ago quarter.
However, the company's quarterly performance is likely to have benefited from higher average guest checks, higher menu pricing and the digital ecosystem. The revamped Red Robin Royalty Program, along with a focus on menu innovation and digital initiatives, is likely to have aided RRGB’s performance in the to-be-reported quarter.
Starting in March, the company launched a new marketing strategy aimed at increasing visit frequency from loyal guests, attracting new guests and enhancing guest engagement. In the second quarter, it tested a new media mix, emphasizing digital streaming TV and video platforms like Hulu, Peacock and YouTube TV. These efforts are likely to have contributed to improved quarterly performance.
The company expects its investments to boost sales and profits, driving long-term shareholders’ value. It observed positive comparable restaurant sales in the first five weeks of the second quarter, thanks to these investments.
For the fiscal second quarter, RRGB expects to achieve modest restaurant sales growth. Our models predict restaurant revenues to inch up 0.3% year over year to $294.1 million in the to-be-reported quarter. We expect average guest check-in to increase 1.6% in the quarter compared with 7.5% in the year-ago quarter.
Margins
Inflationary pressures on commodity and labor are likely to have put pressure on the bottom line in the quarter under discussion. Strategic investments in labor and food quality to support hospitality and the guest experience are likely to have resulted in elevated costs.
Our model expects the restaurant-level operating profit margin for the to-be-reported quarter to decline to 11.9% from 12.6% reported in the year-ago quarter. We anticipate total costs and expenses to increase 6.4% year over year to $306.8 million.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Red Robin this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Earnings ESP: Red Robin has an Earnings ESP of +7.32%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Here are three other companies you may want to consider as our model shows that these, too have the right combination of elements to post an earnings beat this season:
Ollie's Bargain Outlet Holdings, Inc. (OLLI - Free Report) currently has an Earnings ESP of +2.38% and a Zacks Rank of 3. The company is likely to register an earnings beat when it reports second-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for earnings per share of 78 cents implies a rise of 16.4% from the year-ago reported number.
Ollie's Bargain’s top line is expected to have increased year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $562.4 million, which indicates an increase of 9.3% from the prior-year quarter's level. OLLI has a trailing four-quarter earnings surprise of 10.4%, on average.
Target Corporation (TGT - Free Report) has an Earnings ESP of +0.37% and a Zacks Rank of 3 at present. The top line is anticipated to have improved year over year. The Zacks Consensus Estimate for revenues is pegged at $25.3 billion, which implies a 1.9% increase from the figure reported in the year-ago quarter.
The company is expected to register an increase in the bottom line. The consensus estimate for second-quarter earnings is pegged at $2.18 per share, up 21.1% from the year-ago quarter’s level. TGT has a trailing four-quarter earnings surprise of 22.4%, on average.
Costco Wholesale Corporation (COST - Free Report) currently has an Earnings ESP of +0.67% and a Zacks Rank of 3. The company is expected to register top and bottom-line growth when it reports fourth-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for COST’s quarterly revenues is pegged at $80.1 billion, which implies a rise of 1.4% from the year-ago quarter’s reported figure.
The consensus estimate for earnings has increased a penny in the past 30 days to $5.02 per share. The consensus mark for earnings indicates growth of 3.3% from the year-ago quarter’s reported figure. COST's earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 2.3%.
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Red Robin (RRGB) to Report Q2 Earnings: What's in Store?
Red Robin Gourmet Burgers, Inc.’s (RRGB - Free Report) loss is likely to widen year over year when the company reports second-quarter fiscal 2024 results. In the last reported quarter, the company delivered a negative earnings surprise of 95.1%.
How are Estimates Placed?
The Zacks Consensus Estimate is pegged at a loss of 41 cents per share. In the prior-year quarter, RRGB reported a loss per share of 24 cents.
The consensus mark for revenues is pegged at $295.6 million, suggesting a drop of 1% year over year.
Red Robin Gourmet Burgers, Inc. Price and EPS Surprise
Red Robin Gourmet Burgers, Inc. price-eps-surprise | Red Robin Gourmet Burgers, Inc. Quote
Let's look at how things have shaped up in the quarter.
Factors at Play
Revenues
RRGB's fiscal second-quarter top line is expected to have declined year over year due to a decline in comparable restaurant revenues caused by a shift away from deep discounting marketing promotions and dismal guest traffic.
For second-quarter fiscal 2024, our models predict comparable restaurant revenues to decline 5.5% against an increase of 1.5% in the year-ago quarter.
However, the company's quarterly performance is likely to have benefited from higher average guest checks, higher menu pricing and the digital ecosystem. The revamped Red Robin Royalty Program, along with a focus on menu innovation and digital initiatives, is likely to have aided RRGB’s performance in the to-be-reported quarter.
Starting in March, the company launched a new marketing strategy aimed at increasing visit frequency from loyal guests, attracting new guests and enhancing guest engagement. In the second quarter, it tested a new media mix, emphasizing digital streaming TV and video platforms like Hulu, Peacock and YouTube TV. These efforts are likely to have contributed to improved quarterly performance.
The company expects its investments to boost sales and profits, driving long-term shareholders’ value. It observed positive comparable restaurant sales in the first five weeks of the second quarter, thanks to these investments.
For the fiscal second quarter, RRGB expects to achieve modest restaurant sales growth. Our models predict restaurant revenues to inch up 0.3% year over year to $294.1 million in the to-be-reported quarter. We expect average guest check-in to increase 1.6% in the quarter compared with 7.5% in the year-ago quarter.
Margins
Inflationary pressures on commodity and labor are likely to have put pressure on the bottom line in the quarter under discussion. Strategic investments in labor and food quality to support hospitality and the guest experience are likely to have resulted in elevated costs.
Our model expects the restaurant-level operating profit margin for the to-be-reported quarter to decline to 11.9% from 12.6% reported in the year-ago quarter. We anticipate total costs and expenses to increase 6.4% year over year to $306.8 million.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Red Robin this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Earnings ESP: Red Robin has an Earnings ESP of +7.32%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company has a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Stocks With the Favorable Combination
Here are three other companies you may want to consider as our model shows that these, too have the right combination of elements to post an earnings beat this season:
Ollie's Bargain Outlet Holdings, Inc. (OLLI - Free Report) currently has an Earnings ESP of +2.38% and a Zacks Rank of 3. The company is likely to register an earnings beat when it reports second-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for earnings per share of 78 cents implies a rise of 16.4% from the year-ago reported number.
Ollie's Bargain’s top line is expected to have increased year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $562.4 million, which indicates an increase of 9.3% from the prior-year quarter's level. OLLI has a trailing four-quarter earnings surprise of 10.4%, on average.
Target Corporation (TGT - Free Report) has an Earnings ESP of +0.37% and a Zacks Rank of 3 at present. The top line is anticipated to have improved year over year. The Zacks Consensus Estimate for revenues is pegged at $25.3 billion, which implies a 1.9% increase from the figure reported in the year-ago quarter.
The company is expected to register an increase in the bottom line. The consensus estimate for second-quarter earnings is pegged at $2.18 per share, up 21.1% from the year-ago quarter’s level. TGT has a trailing four-quarter earnings surprise of 22.4%, on average.
Costco Wholesale Corporation (COST - Free Report) currently has an Earnings ESP of +0.67% and a Zacks Rank of 3. The company is expected to register top and bottom-line growth when it reports fourth-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for COST’s quarterly revenues is pegged at $80.1 billion, which implies a rise of 1.4% from the year-ago quarter’s reported figure.
The consensus estimate for earnings has increased a penny in the past 30 days to $5.02 per share. The consensus mark for earnings indicates growth of 3.3% from the year-ago quarter’s reported figure. COST's earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 2.3%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.