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Brinker International (EAT) Laps the Stock Market: Here's Why

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The most recent trading session ended with Brinker International (EAT - Free Report) standing at $76.53, reflecting a +1.24% shift from the previouse trading day's closing. The stock's performance was ahead of the S&P 500's daily gain of 0.42%. Elsewhere, the Dow saw an upswing of 0.04%, while the tech-heavy Nasdaq appreciated by 0.38%.

The the stock of operator of restaurant chains Chili's Grill & Bar and Maggiano's Little Italy has risen by 5.69% in the past month, lagging the Retail-Wholesale sector's gain of 6.34% and overreaching the S&P 500's gain of 2.06%.

Market participants will be closely following the financial results of Brinker International in its upcoming release. It is anticipated that the company will report an EPS of $0.64, marking a 128.57% rise compared to the same quarter of the previous year. Meanwhile, the latest consensus estimate predicts the revenue to be $1.08 billion, indicating a 6.9% increase compared to the same quarter of the previous year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $4.66 per share and revenue of $4.58 billion. These totals would mark changes of +13.66% and +3.76%, respectively, from last year.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Brinker International. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.43% increase. As of now, Brinker International holds a Zacks Rank of #3 (Hold).

From a valuation perspective, Brinker International is currently exchanging hands at a Forward P/E ratio of 16.21. This indicates a discount in contrast to its industry's Forward P/E of 21.18.

It is also worth noting that EAT currently has a PEG ratio of 1.23. 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 the market closed yesterday, the Retail - Restaurants industry was having an average PEG ratio of 2.21.

The Retail - Restaurants industry is part of the Retail-Wholesale sector. Currently, this industry holds a Zacks Industry Rank of 178, positioning it in the bottom 30% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the 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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