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Sit-Down Dining Stocks Q1 In Review: Brinker International (NYSE:EAT) Vs Peers


Jabin Bastian /
2024/07/05 6:09 am EDT

Let's dig into the relative performance of Brinker International (NYSE:EAT) and its peers as we unravel the now-completed Q1 sit-down dining earnings season.

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.

The 14 sit-down dining stocks we track reported an ok Q1; on average, revenues missed analyst consensus estimates by 0.9%. Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride, as the market switches between optimism and pessimism around rate cuts due to mixed inflation data, and sit-down dining stocks have had a rough stretch, with share prices down 8.1% on average since the previous earnings results.

Brinker International (NYSE:EAT)

Founded by Norman Brinker in Dallas, Texas, Brinker International (NYSE:EAT) is a casual restaurant chain that operates under the Chili’s, Maggiano’s Little Italy, and It’s Just Wings banners.

Brinker International reported revenues of $1.12 billion, up 3.4% year on year, falling short of analysts' expectations by 0.1%. It was a very strong quarter for the company, with an impressive beat of analysts' gross margin estimates and optimistic earnings guidance for the full year.

"Our strong third quarter results were driven by the continued progress on guest experience, team member experience, and traffic driving initiatives," said Kevin Hochman, Chief Executive Officer and President of Brinker International.

Brinker International Total Revenue

The stock is up 42.2% since the results and currently trades at $70.6.

Is now the time to buy Brinker International? Access our full analysis of the earnings results here, it's free.

Best Q1: BJ's (NASDAQ:BJRI)

Founded in 1978 in California, BJ’s Restaurants (NASDAQ:BJRI) is a chain of restaurants whose menu features classic American dishes, often with a twist.

BJ's reported revenues of $337.3 million, down 1.2% year on year, in line with analysts' expectations. It was an exceptional quarter for the company, with an impressive beat of analysts' same store sales, gross margin, and EPS estimates.

BJ's Total Revenue

The stock is up 9.2% since the results and currently trades at $35.74.

Is now the time to buy BJ's? Access our full analysis of the earnings results here, it's free.

Weakest Q1: Dine Brands (NYSE:DIN)

Operating a franchise model, Dine Brands (NYSE:DIN) is a casual restaurant chain that owns the Applebee’s and IHOP banners.

Dine Brands reported revenues of $206.2 million, down 3.5% year on year, falling short of analysts' expectations by 2%. It was a weak quarter for the company, with a miss of analysts' earnings estimates.

The stock is down 21.8% since the results and currently trades at $34.14.

Read our full analysis of Dine Brands's results here.

Denny's (NASDAQ:DENN)

Open around the clock, Denny’s (NASDAQ:DENN) is a chain of diner restaurants serving breakfast and traditional American fare.

Denny's reported revenues of $110 million, down 6.4% year on year, falling short of analysts' expectations by 4.5%. It was a weaker quarter for the company, with a miss of analysts' earnings estimates. On a brighter note, full year same store sales was maintained and full year adjusted EBITDA was raised slightly.

Denny's had the weakest performance against analyst estimates among its peers. The stock is down 17.4% since the results and currently trades at $6.62.

Read our full, actionable report on Denny's here, it's free.

First Watch (NASDAQ:FWRG)

Based on a nautical reference to the first work shift aboard a ship, First Watch (NASDAQ:FWRG) is a chain of breakfast and brunch restaurants whose menu is heavily-focused on eggs and griddle items such as pancakes.

First Watch reported revenues of $242.4 million, up 14.7% year on year, falling short of analysts' expectations by 1.1%. It was a strong quarter for the company, with an impressive beat of analysts' gross margin estimates and a decent beat of analysts' earnings estimates.

The stock is down 35.6% since the results and currently trades at $16.19.

Read our full, actionable report on First Watch here, it's free.

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