Group 1 - The article discusses the investment position of Travis Hoium in Portillo's, indicating a personal stake in the company [1] - The Motley Fool, the platform associated with Travis Hoium, does not hold any positions in the stocks mentioned, suggesting a separation between personal and organizational interests [1] - There is a mention of a disclosure policy by The Motley Fool, which highlights the importance of transparency in investment recommendations [1]

I am an Equity Analyst and Accountant specializing in restaurant stocks, with a solid foundation in Business Administration and Accounting, complemented by an MBA in Forensic Accounting and Controllership. As the founder of Goulart's Restaurant Stocks, I lead a company focused on analyzing restaurant stocks in the U.S. market. Our coverage spans multiple segments, including QSR, fast casual, casual dining, fine dining, and family dining. We employ advanced analytical models and specialized valuation techniq ...

For those looking to find strong Retail-Wholesale stocks, it is prudent to search for companies in the group that are outperforming their peers. Has Portillo's Inc. (PTLO) been one of those stocks this year? By taking a look at the stock's year-to-date performance in comparison to its Retail-Wholesale peers, we might be able to answer that question.Portillo's Inc. is one of 212 individual stocks in the Retail-Wholesale sector. Collectively, these companies sit at #2 in the Zacks Sector Rank. The Zacks Secto ...

Fourth Quarter Earnings Supplemental February 25, 2025 CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS & NON-GAAP MEASURES This presentation contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995 ("PSLRA"). All statements other than statements of historical fact are forward-looking statements. Forward-looking statements discuss our current expectations and projections relating to our financial position, results of operations, plans, objectives, future p ...

Financial Data and Key Metrics Changes - Same restaurant sales increased by 0.4% in Q4 2024, while full-year comparable sales were down 0.6% [8][9] - Total revenue for Q4 2024 was $184.6 million, a decrease of $3.2 million or 1.7% year-over-year, but grew 6.1% when excluding the impact of an additional operating week in Q4 2023 [26][27] - Restaurant-level adjusted EBITDA for Q4 2024 was $45.2 million, with a margin of 24.5%, compared to $26.1 million in Q4 2023 [9][36][39] Business Line Data and Key Metrics Changes - Revenue growth in Q4 was driven by non-comparable restaurants contributing $8.6 million, while same restaurant sales growth contributed approximately $600,000 [27] - Average check increased by 4.1%, driven by a 4.7% increase in certain menu prices, partially offset by a 3.7% decrease in transactions [28] Market Data and Key Metrics Changes - The company plans to open twelve new restaurants in 2025, focusing on Texas and Georgia, with a new compact restaurant format expected to lower build costs significantly [14][15][134] - The advertising campaign launched in Dallas-Fort Worth aims to increase brand awareness in Texas, targeting a market with previously low recognition [16][88] Company Strategy and Development Direction - The company is focusing on four key traffic-driving strategies: expanding kiosk usage, advertising beyond Chicagoland, launching the Portillo's Perks loyalty program, and improving operational efficiency [12] - The new compact restaurant format aims to reduce average build costs by over a million dollars, with expectations for strong returns [13][134] Management's Comments on Operating Environment and Future Outlook - Management acknowledged industry headwinds, including weather impacts in February, but expressed confidence in the underlying strength of the business and anticipated improvements in the latter half of 2025 [11][50] - The company expects revenue growth to continue driven by new restaurant openings and modest same-store sales growth in the range of flat to 2% [30] Other Important Information - Commodity inflation is estimated at 3% to 5% for 2025, with significant pressures expected from beef [33][78] - The company has reduced its term loan from $300 million to $250 million, increasing financial flexibility to support growth strategies [40][41] Q&A Session Summary Question: Weather impact on Q1 performance - Management has not quantified the weather impact but remains confident in achieving full-year guidance of 0% to 2% growth despite early challenges [48][50] Question: Drive-through speed improvements - Every thirty seconds of improved throughput in the drive-through is equivalent to one point of comp, and management is optimistic about deploying improvements quickly if tests continue to perform well [52][54] Question: Restaurant of the Future prototype performance - Initial performance of the new restaurant format is promising, with expectations for improved operational efficiency and capital returns [57][60] Question: Menu streamlining effects - Streamlining the menu has reduced complexity and improved throughput, with positive feedback from customers on key items being reintroduced [62][64] Question: Traffic growth expectations - Management anticipates steady improvement in traffic throughout the year, with a conservative approach to pricing and mix [110][112] Question: New restaurant openings in Atlanta - The new restaurant in Atlanta is expected to open in the back half of 2025, with uncertain volume predictions due to being a first-in-market location [115][116] Question: Loyalty program rollout - The loyalty program is in soft launch and expected to fully launch in March, with anticipated positive impacts on traffic in Q2 [122] Question: New store maturity in Texas - New restaurants in Texas are performing more consistently with mature market expectations, with a focus on achieving density for effective marketing [128][131] Question: Non-traditional restaurant formats - The company is fine-tuning the drive-through only format and exploring additional locations, including walk-up options [96][98]

Financial Performance - Portillo's reported revenue of $184.6 million for the fourth quarter, reflecting a year-over-year decrease of 1.7%, but this was due to a shorter reporting period compared to the previous year [2] - The company achieved a net income of $12.4 million, marking a 29% increase, resulting in adjusted earnings per share (EPS) of $0.17, significantly above analysts' consensus estimates of $0.07 [2] - Same-store sales increased by 0.4% year over year, reversing a trend of declines over the past three quarters [3] Operational Insights - Restaurant-level earnings before interest, taxes, depreciation, and amortization (EBITDA) decreased by 1.1% to $45.2 million, influenced by the shorter quarter [3] - Portillo's added six new locations in the fourth quarter, indicating continued measured expansion [3] Market Context - The restaurant industry, including Portillo's, has faced challenges from historically high inflation, high commodity prices, and rising labor costs, impacting operations and consumer spending [4] - Despite these challenges, Portillo's experienced an increase in average check size, although this was partially offset by fewer transactions [5] - The increase in same-store sales reflects the company's strategy of maintaining low prices to foster customer loyalty [5] - Portillo's outperformed its peers in average unit volume, generating sales of $9.1 million per location, surpassing competitors in the fast-food sector [5] Strategic Focus - The company is concentrating on fundamental operations to position itself for future success once inflationary pressures subside [6]

Portillo's Inc. (PTLO) came out with quarterly earnings of $0.17 per share, beating the Zacks Consensus Estimate of $0.07 per share. This compares to earnings of $0.13 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 142.86%. A quarter ago, it was expected that this company would post earnings of $0.07 per share when it actually produced earnings of $0.11, delivering a surprise of 57.14%.Over the last four quarters, the company ...

Financial Performance - Total revenues for the fiscal year ended December 29, 2024, increased to $710,554,000, up 4.9% from $679,905,000 in the previous year[356]. - Net income attributable to Portillo's Inc. for the fiscal year 2024 was $29,517,000, representing a 60.1% increase from $18,424,000 in 2023[356]. - Basic earnings per share increased to $0.48 in 2024, compared to $0.34 in 2023, reflecting a 41.2% growth[356]. - For the fiscal year ended December 29, 2024, Portillo's reported a net income of $35,076,000, an increase of 41.3% compared to $24,818,000 in 2023[362]. - The total income tax expense for the fiscal year ended December 29, 2024 was $6.8 million, up from $3.2 million in 2023, indicating a 109.0% increase[508]. - The effective income tax rate for the year ended December 29, 2024 was 16.2%, compared to 11.5% in 2023, primarily due to an increase in the Company's ownership interest in Portillo's OpCo[508]. - The weighted-average number of common shares outstanding for basic earnings per share increased to 61.1 million in 2024 from 53.8 million in 2023, a growth of 13.5%[522]. Assets and Liabilities - Total current assets rose to $52,651,000 in 2024, a 25.7% increase from $41,919,000 in 2023[355]. - Total liabilities increased to $1,009,983,000 in 2024, up 9.1% from $925,431,000 in 2023[355]. - Total stockholders' equity attributable to Portillo's Inc. grew to $401,061,000 in 2024, a 24.4% increase from $322,379,000 in 2023[355]. - Long-term debt, net of current portion, decreased to $275,422,000 in 2024 from $283,923,000 in 2023, a decline of 3.0%[355]. - The Company reported total equity of $490,103,000 as of December 29, 2024, compared to $460,110,000 as of December 31, 2023, indicating an increase of 6.5%[360]. - The total debt as of December 29, 2024, was $311,672 thousand, which includes $288,750 thousand from the 2023 Term Loan and $25,000 thousand from the 2023 Revolver Facility[449]. Cash Flow and Expenditures - The company generated net cash provided by operating activities of $98,040,000 in 2024, up from $70,781,000 in 2023, reflecting a 38.5% increase[362]. - Portillo's incurred capital expenditures of $88,191,000 in 2024, slightly higher than $87,918,000 in 2023[362]. - Cash and cash equivalents increased significantly to $22,876,000 in 2024, compared to $10,438,000 in 2023, marking a 119.1% rise[355]. - Interest paid by the company in 2024 was $19,445,000, a decrease from $28,282,000 in 2023[363]. Tax and Agreements - The company has entered into a Tax Receivable Agreement (TRA) requiring it to pay 85% of cash savings from tax benefits realized post-IPO[348]. - The Company made payments of $4.4 million under the Tax Receivable Agreement (TRA) during the year ended December 29, 2024, with an estimated future obligation of $324.6 million[520]. - The TRA liability calculation involves significant future events and assumptions, making it complex and requiring auditor judgment[351]. Operational Metrics - As of December 29, 2024, Portillo's operated 93 restaurants, an increase from 83 restaurants as of December 31, 2023, representing a growth of 12.0%[366]. - The Company operates fast-casual restaurants in the United States and has two food production commissaries in Illinois[526]. - The Company has one operating segment and one reportable segment[526]. Risk Management - The company utilizes various risk management strategies to mitigate commodity price risks, including purchasing contracts and pricing arrangements[332]. - The company employs strategies to combat inflation, including operational efficiencies and strategic menu price increases[335]. - Labor costs are impacted by increases in minimum wage and competitive market pressures, which may adversely affect overall labor expenses[338]. Stock and Compensation - Approximately 7.1 million shares of Class A common stock were authorized for awards under the 2021 Equity Incentive Plan[490]. - The total unrecognized compensation cost related to unvested RSUs was $7.0 million, expected to vest over a weighted-average period of 2.0 years[491]. - The total equity-based compensation expense for the fiscal year ended December 29, 2024, was $11.151 million, a decrease from $15.542 million in the previous year[505]. Accounting and Compliance - The company’s financial statements have been audited and present a fair view of its financial position as of December 29, 2024[343]. - The Company is currently evaluating the effect of adopting recently issued accounting standards, including ASU 2023-09 and ASU 2024-03[421][423]. - The Company was in compliance with all covenants in the 2023 Credit Agreement as of December 29, 2024[469].

Core Insights - Portillo's Inc. reported financial results for the fourth quarter and fiscal year ended December 29, 2024, highlighting solid momentum and strategic initiatives for long-term growth [1][2]. Financial Highlights for Fourth Quarter 2024 - Total revenue decreased by 1.7% to $184.6 million compared to $187.9 million in the prior year [11]. - Same-restaurant sales increased by 0.4%, attributed to a 4.1% rise in average check, despite a 3.7% decrease in transactions [11]. - Operating income fell by $0.6 million to $13.8 million, while net income rose by $2.8 million to $12.4 million [15][16]. - Restaurant-Level Adjusted EBITDA decreased by $0.5 million to $45.2 million, and Adjusted EBITDA decreased by $0.9 million to $25.2 million [17]. Financial Highlights for Fiscal Year 2024 - Total revenue increased by 4.5% to $710.6 million, driven by the opening of new restaurants [19]. - Same-restaurant sales decreased by 0.6%, with a 3.2% drop in transactions offset by a 2.6% increase in average check [19]. - Operating income rose by $2.6 million to $58.0 million, and net income increased by $10.3 million to $35.1 million [22][23]. - Restaurant-Level Adjusted EBITDA increased by $2.9 million to $168.1 million, and Adjusted EBITDA grew by $2.5 million to $104.8 million [24]. Recent Developments and Trends - The company opened 10 new restaurants in fiscal 2024, expanding its footprint in various states [10]. - Commodity inflation stabilized, with rates of 1.8% in Q4 2024 and 4.2% for the fiscal year, compared to higher rates in the previous year [9]. - Labor expenses as a percentage of revenue decreased by 0.1% due to higher average checks and lower variable compensation [9]. Fiscal 2025 Financial Targets - The company aims to open 12 new units, with same-restaurant sales projected to be flat to +2% and revenue growth targeted at 11% to 12% [26]. - Commodity inflation is expected to range from 3% to 5%, and labor inflation is projected at 3% to 4% [26]. Long-Term Financial Targets - Annual unit growth is targeted at 12% to 15%, with revenue growth anticipated in the mid-teens [27].

Technical Analysis - Portillo's Inc. (PTLO) has reached a significant support level, indicating a potential investment opportunity from a technical perspective [1] - PTLO's 50-day simple moving average has recently crossed above its 200-day moving average, forming a "golden cross," which is a bullish signal [1] Golden Cross Characteristics - A golden cross consists of three stages: a downtrend that bottoms out, a shorter moving average crossing above a longer moving average, and a subsequent upward price movement [2] - This pattern is contrasted with a death cross, which signals potential bearish price movement [2] Recent Performance and Outlook - PTLO shares have increased by 31.2% over the past four weeks, indicating strong upward momentum [3] - The company holds a 2 (Buy) rating on the Zacks Rank, suggesting it may be positioned for further breakout [3] - Positive earnings outlook is supported by no earnings estimate cuts and five upward revisions in the past 60 days, with the Zacks Consensus Estimate also increasing [3][4]