Bloomin' Brands (NASDAQ:BLMN) Posts Q4 Sales In Line With Estimates

Adam Hejl /
2024/02/23 6:54 am EST

Restaurant company Bloomin’ Brands (NASDAQ:BLMN) reported results in line with analysts' expectations in Q4 FY2023, with revenue up 9.1% year on year to $1.19 billion. It made a non-GAAP profit of $0.75 per share, improving from its profit of $0.68 per share in the same quarter last year.

Is now the time to buy Bloomin' Brands? Find out by accessing our full research report, it's free.

Bloomin' Brands (BLMN) Q4 FY2023 Highlights:

  • Revenue: $1.19 billion vs analyst estimates of $1.20 billion (small miss)
  • EPS (non-GAAP): $0.75 vs analyst estimates of $0.69 (8.6% beat)
  • EPS (non-GAAP) Guidance for Q1 2024 is $0.73 at the midpoint, below analyst estimates of $0.93
  • Gross Margin (GAAP): 17.6%, down from 18.3% in the same quarter last year
  • Same-Store Sales were down 0.2% year on year
  • Store Locations: 1,480 at quarter end, decreasing by 27 over the last 12 months
  • Market Capitalization: $2.31 billion

Owner of the iconic Australian-themed Outback Steakhouse, Bloomin’ Brands (NASDAQ:BLMN) is a leading American restaurant company that owns and operates a portfolio of popular restaurant brands.

Sit-Down Dining

Sit-down restaurants offer a complete dining experience with table service. These establishments span various cuisines and are renowned for their warm hospitality and welcoming ambiance, making them perfect for family gatherings, special occasions, or simply unwinding. Their extensive menus range from appetizers to indulgent desserts and wines and cocktails. This space is extremely fragmented and competition includes everything from publicly-traded companies owning multiple chains to single-location mom-and-pop restaurants.

Sales Growth

Bloomin' Brands is one of the larger restaurant chains in the industry and benefits from a strong brand, giving it customer mindshare and influence over purchasing decisions.

As you can see below, the company's annualized revenue growth rate of 3.1% over the last four years (we compare to 2019 to normalize for COVID-19 impacts) was weak as its restaurant footprint remained unchanged, implying that growth was driven by more sales at existing, established dining locations.

Bloomin' Brands Total Revenue

This quarter, Bloomin' Brands's revenue grew 9.1% year on year to $1.19 billion, missing Wall Street's expectations. Looking ahead, Wall Street expects revenue to remain flat over the next 12 months, a deceleration from this quarter.

Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we’ve identified a relatively under-the-radar profitable growth stock benefitting from the rise of AI, available to you FREE via this link.

Same-Store Sales

Bloomin' Brands's demand within its existing restaurants has generally risen over the last two years but lagged behind the broader sector. On average, the company's same-store sales have grown by 2.7% year on year. Given its flat restaurant base over the same period, this performance stems from increased foot traffic or larger order sizes per customer at existing locations.

Bloomin' Brands Year On Year Same Store Sales Growth

In the latest quarter, Bloomin' Brands's year on year same-store sales were flat. By the company's standards, this growth was a meaningful deceleration from the 1.4% year-on-year increase it posted 12 months ago. We'll be watching Bloomin' Brands closely to see if it can reaccelerate growth.

Key Takeaways from Bloomin' Brands's Q4 Results

We were impressed by how significantly Bloomin' Brands blew past analysts' gross margin and EPS expectations this quarter. On the other hand, its revenue missed as its same-store sales were flat. Double-clicking into its same-store sales by banner, however, we can see that Carrabba's Italian Grill was its lone bright spot with same-store sales rising 2.5%.

For 2024, the company expects to open 40 to 45 new restaurants and grow its same-store sales by 1%, though it expects same-store sales to be down next quarter (signaling an acceleration in the back half of the year as it'll be growing off easier year-on-year comps). On the EPS side, its forecast unfortunately fell short of Wall Street's estimates. Zooming out, we think this was still a decent, albeit mixed, quarter, showing that the company is staying on track. The stock is flat after reporting and currently trades at $26.5 per share.

So should you invest in Bloomin' Brands right now? When making that decision, it's important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it's free.