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CAVA Stock Before Q2 Earnings: Should You Buy, Sell or Hold?
ZACKS· 2025-08-08 14:01
Core Viewpoint - CAVA Group, Inc. is set to report its second-quarter 2025 results on August 12, with expectations of revenue growth but a decline in earnings per share (EPS) compared to the previous year [1][8]. Financial Performance - In the last reported quarter, CAVA's earnings exceeded the Zacks Consensus Estimate by 57.1%, with an average surprise of 26.9% over the past four quarters [1][2]. - The Zacks Consensus Estimate for Q2 2025 EPS remains unchanged at 13 cents, reflecting a 23.5% decline from the year-ago EPS of 17 cents [3]. - Revenue is projected at $286.6 million, indicating a year-over-year growth of 22.7% [3]. Earnings Prediction Model - The current Earnings ESP for CAVA is +1.89%, but the company holds a Zacks Rank of 4 (Sell), suggesting a lower likelihood of an earnings beat this quarter [4]. Factors Influencing Performance - Strong same-restaurant sales trends and positive traffic are expected to support revenue growth, with a consensus estimate for same-restaurant sales at 5.9% [6][9]. - Marketing initiatives and product innovations, including new menu items and expansion into new markets, are aimed at enhancing customer engagement [7][9]. - The loyalty program has seen growth, nearing 8 million members, which may contribute to increased customer retention [9]. Cost Pressures - Rising costs in food, beverage, and packaging, particularly from steak, are impacting profitability [10]. - Increased labor expenses due to investments in wages and benefits, along with higher pre-opening costs, are also contributing to margin pressures [10][11]. - The company is taking a cautious approach to menu price increases amid inflation, which limits its ability to offset rising costs [11]. Stock Performance and Valuation - CAVA's stock has declined 1.6% over the past year, underperforming its industry peers [12]. - The company's forward 12-month price-to-sales ratio stands at 7.63, significantly higher than the industry average and the S&P 500's 5.21, raising concerns about overvaluation [16][17]. Investment Outlook - The upcoming earnings report presents a mix of growth potential and cost challenges, leading to an unfavorable risk-reward setup for investors [17][18]. - While the brand is expanding and driving traffic through innovation, rising input costs and a cautious pricing strategy may weigh on future performance [18].
X @Bloomberg
Bloomberg· 2025-08-08 11:34
Wendy’s cut its sales guidance after posting a bigger than expected decline, highlighting the economic pressures weighing on the chain’s US business https://t.co/4Z8bySxpBP ...
THE WENDY'S COMPANY REPORTS SECOND QUARTER 2025 RESULTS
Prnewswire· 2025-08-08 11:00
Core Viewpoint - The Wendy's Company reported a decline in overall systemwide sales for the second quarter of 2025, primarily due to lower same-restaurant sales in the U.S., while the international segment showed strong growth. Operational Highlights - The company opened 44 new restaurants in the second quarter, totaling 118 new openings in the first half of 2025 [2] - International systemwide sales grew by 8.7%, while U.S. systemwide sales declined by 3.3% [2][5] - Same-restaurant sales growth in the U.S. was down 3.6%, compared to a 1.8% increase in the international segment [2][5] - The total restaurant count at the end of the quarter was 7,334, with 5,967 in the U.S. and 1,367 internationally [2] Financial Highlights - Total revenues for the second quarter were $560.9 million, a decrease of 1.7% from the previous year [4] - Adjusted revenues were $449.6 million, down 1.3% year-over-year [4] - U.S. Company-operated restaurant margin decreased to 16.2%, down from 16.5% [4][7] - Operating profit increased to $104.3 million, up 4.8% from the previous year [4][10] - Net income for the quarter was $55.1 million, a slight increase of 0.9% [4][11] - Reported diluted earnings per share were $0.29, reflecting a 7.4% increase [4][13] Cash Flow and Shareholder Returns - Cash flow from operations was $146.0 million, a 0.3% increase year-over-year [4] - The company returned $88.7 million to shareholders through dividends and share repurchases [9] - The company repurchased 4.8 million shares for $61.9 million in the second quarter [15] 2025 Outlook - The company reaffirmed its global net unit growth target of 2-3% and capital expenditures between $165 million and $175 million [16] - The updated expectations for global systemwide sales growth are now between -5.0% to -3.0% [16] - Adjusted earnings per share are expected to be between $0.82 and $0.89, down from previous estimates [16]
Happy Belly Food Group's Yolks Breakfast Signs Franchise Agreement and Real-Estate Location in the City of Chilliwack, British Columbia
Newsfile· 2025-08-08 11:00
Toronto, Ontario--(Newsfile Corp. - August 8, 2025) - Happy Belly Food Group Inc. (CSE: HBFG) (OTCQB: HBFGF) ("Happy Belly" or the "Company"), a leader in acquiring and scaling emerging food brands is pleased to announce that a multi-unit Yolks Breakfast franchisee has expanded their portfolio by signing for a fourth franchise agreement along-side securing a real-estate location in Chilliwack, British Columbia. Yolks Breakfast ("Yolks") is a boutique restaurant brand serving delicious breakfast, brunch and ...
Nathan's Famous, Inc. Reports First Quarter Results
GlobeNewswire News Room· 2025-08-08 10:30
JERICHO, N.Y., Aug. 08, 2025 (GLOBE NEWSWIRE) -- Nathan's Famous, Inc. (“Nathan’s”, the “Company”, “we”, “us” or “our”) (NASDAQ:NATH) today reported results for its first fiscal quarter ended June 29, 2025. For the thirteen-week period ended June 29, 2025 (“first quarter fiscal 2026”): Revenues were $46,998,000 as compared to $44,767,000 during the thirteen weeks ended June 30, 2024;Income from operations was $12,791,000 as compared to $13,745,000 during the thirteen weeks ended June 30, 2024;Adjusted EBITD ...
The Keg Royalties Income Fund Receives Final Court Approval for the Transaction with Fairfax
Globenewswire· 2025-08-07 23:16
Company Overview - The Keg Royalties Income Fund is a limited purpose, open-ended trust established under Ontario law, owning trademarks and intellectual property used by Keg Restaurants Ltd. [6] - Keg Restaurants Ltd. is the leading operator and franchisor of steakhouse restaurants in Canada, with a significant presence in select U.S. markets [7] - Keg Restaurants Ltd. was recognized as the number one restaurant company to work for in Canada in Forbes' "Canada's Best Employers 2025" survey [7] Transaction Details - The Supreme Court of British Columbia approved the acquisition of all issued and outstanding units of the Fund by 1543965 B.C. Ltd., a subsidiary of Fairfax Financial Holdings Limited [1] - The transaction will become effective at 12:05 a.m. (Pacific Time) on August 13, 2025, with all conditions satisfied except those that can only be met at closing [2] - The units of the Fund are expected to be delisted from the Toronto Stock Exchange following the transaction [2] Fairfax Financial Holdings Limited - Fairfax Financial Holdings Limited is a holding company primarily engaged in property and casualty insurance and reinsurance, along with associated investment management [8]
Texas Roadhouse(TXRH) - 2025 Q2 - Earnings Call Transcript
2025-08-07 22:02
Financial Data and Key Metrics Changes - The company reported a revenue growth of 12.7%, driven by a 5.3% increase in average weekly sales and a 7.2% store week growth [20] - Diluted earnings per share increased by 4% to $1.86 [20] - Restaurant margin dollars increased by 6.1% to $257 million, while restaurant margin as a percentage of total sales decreased by 108 basis points year over year to 17.1% [21][22] Business Line Data and Key Metrics Changes - Texas Roadhouse averaged approximately $172,000 in weekly sales, while Bubba's 33 averaged over $128,000 in weekly sales [9] - Jaggers delivered average weekly sales of nearly $76,000 in the second quarter [10] - The company plans to open as many as eight company and franchise locations next year for Jaggers and Bubba's 33 [10][12] Market Data and Key Metrics Changes - Comparable sales increased by 5.8% in the second quarter, driven by 4% traffic growth and a 1.8% increase in average check [20] - Comparable sales for the first five weeks of the third quarter were up 5.3% [21] Company Strategy and Development Direction - The company is focused on a growth strategy that includes opening approximately 30 company-owned restaurants this year and acquiring additional franchise locations [12][18] - The company plans to take a menu price increase of approximately 1.7% at the beginning of the fourth quarter to offset inflationary pressures [11] - The company remains committed to its community and plans to purchase its support center buildings, reflecting a long-term commitment to Louisville, Kentucky [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of operations and the commitment of the team, despite challenges in the operating environment [14] - The company has increased its guidance for full-year inflation to approximately 5%, primarily due to higher beef inflation [16] - Management remains optimistic about the growth potential of Bubba's 33 and Jaggers, with plans for double-digit openings next year [10][43] Other Important Information - The company ended the second quarter with $177 million in cash, with cash flow from operations at $128 million [17] - The company is maintaining its full-year capital expenditure guidance at approximately $400 million [18] Q&A Session Summary Question: Insights on inflation dynamics - Management noted that strong retail demand for beef and tighter supply have driven inflation, with expectations of 7% commodity inflation in Q3 [26][29] Question: Mix effect and consumer behavior - Negative mix pressure is primarily from the alcohol category, while positive trends are seen in entrees and mocktails [33][36] Question: Inflation outlook for Q3 and Q4 - Management expects inflation to be highest in Q3, around 7%, and to decrease to 4-5% in Q4 [41][42] Question: Growth opportunities in Bubba's - Management indicated a solid pipeline for Bubba's growth, with potential for more than 30 openings in the coming years [43][44] Question: Off-premise sales growth - The increase in off-premise sales is attributed to improved operational efficiency and the mobile app's convenience [119][122] Question: Delivery considerations - Management has resisted expanding delivery services, focusing instead on enhancing the off-premise pickup experience [130][132] Question: Construction costs and tariffs - No significant impact from tariffs on construction costs has been observed yet, with inventory levels remaining stable [81][82]
Sweetgreen(SG) - 2025 Q2 - Earnings Call Transcript
2025-08-07 22:00
Financial Data and Key Metrics Changes - For Q2 2025, the company reported total sales of $185.6 million, a slight increase from $184.6 million in Q2 2024, with a same-store sales decline of 7.6% [5][17] - Restaurant level margin for the quarter was 18.9%, down from 22.5% year-over-year, primarily due to sales deleverage and tariff impacts [22] - The net loss for the quarter was $23.2 million, compared to a loss of $14.5 million in the prior year [24][25] - Adjusted EBITDA was $6.4 million, down from $12.4 million in the prior year [25] Business Line Data and Key Metrics Changes - The average unit volume in Q2 was $2.8 million, with nine new restaurant openings, four of which were Infinite Kitchens [18] - The company closed two older restaurants in New York City, redirecting volume to newer locations, which saw same-store sales increase by 15% to 20% shortly after [20] Market Data and Key Metrics Changes - The company experienced a 2.5% benefit from menu price increases, but a negative 10.1% impact from traffic and mix [18] - The Northeast market continued to show pronounced pressure, aligning with broader industry trends [62][94] Company Strategy and Development Direction - The company plans to open at least 40 new restaurants in 2025 and enter four new markets: Arkansas, Sacramento, Phoenix, and Cincinnati [21] - The focus remains on enhancing the value proposition through menu innovation and a revamped loyalty program [8][26] - The company is implementing Project One Best Way to improve operational excellence and consistency across restaurants [12][38] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging quarter due to external headwinds and internal transitions, but expressed confidence in the recovery plan [6][26] - There are early signs of improvement in same-store sales and guest frequency due to the rollout of seasonal menus and the loyalty program [30][57] - Management emphasized the importance of delivering excellent guest experiences as a key driver for future growth [31][79] Other Important Information - The company is seeing improvements in labor costs and team member retention, with head coach stability at an all-time high [43][44] - The transition to the new loyalty program created a temporary headwind, but management expects it to become a tailwind as customer engagement improves [72][74] Q&A Session Summary Question: Are there signs of same-store sales improvement in Q3? - Management confirmed modest improvement in same-store sales due to the seasonal menu rollout and loyalty program [30] Question: What are the biggest operational issues currently? - Management identified throughput and food quality as key focus areas, with ongoing efforts to improve these metrics [31][36] Question: Can you elaborate on labor cost improvements? - Management noted that labor costs per store week have improved due to better workforce management and lower turnover rates [41][43] Question: Are there plans to slow down development to focus on same-store sales? - Management expressed strong conviction in long-term growth and plans to maintain the development pipeline while ensuring operational readiness [51] Question: What is driving the restaurant level margin guidance down? - Management indicated that the primary driver is sales deleverage, with some impact from increased portion sizes [53] Question: How is the loyalty program performing? - Management reported that the loyalty program is seeing steady growth in membership and frequency, with expectations for it to become a positive contributor [72][74] Question: Is there a degradation in price value perception? - Management believes the issue is more about execution rather than price value perception, emphasizing the need for consistent delivery of quality experiences [78][79]
Good Times(GTIM) - 2025 Q3 - Earnings Call Transcript
2025-08-07 22:00
Financial Data and Key Metrics Changes - Total restaurant sales for Bad Daddy's decreased by $800,000 to $26.5 million for the quarter, primarily due to the closure of one restaurant and reduced customer traffic [11] - Good Times' total restaurant sales decreased by approximately $100,000 to $10.4 million, with same store sales down 9% [14] - Net income for the quarter was $1.5 million, or $0.14 per share, compared to $1.3 million, or $0.12 per share in the same quarter last year [17] Business Line Data and Key Metrics Changes - Bad Daddy's same store sales decreased by 1.4% for the quarter, with food and beverage costs at 30.6%, a decrease of 60 basis points from the previous year [12] - Good Times' same store sales decreased by 9%, with food and packaging costs at 31.5%, an increase of 100 basis points compared to the prior year [15] - Restaurant level operating profit for Bad Daddy's was approximately $3.8 million, or 14.4% of sales, compared to $3.9 million, or 14.3% last year [14] Market Data and Key Metrics Changes - Competitors in the QSR segment, particularly burger QSRs, are heavily discounting, impacting Good Times' sales performance [15][31] - Ground beef prices are at record highs, affecting both brands, with expectations of continued increases throughout the fiscal year [9][13] Company Strategy and Development Direction - The company is focusing on quality positioning rather than discounting, having not taken price increases since January 2024, and is now in parity with competitors [6] - A new marketing leader has been hired to enhance advertising and promotion strategies for both brands [4] - The company plans to launch a new campaign centered around Colorado native burgers and is considering incremental menu price increases to offset input cost inflation [8][9] Management's Comments on Operating Environment and Future Outlook - Management noted mixed results in the third quarter, with improvements in same store sales at Bad Daddy's but declines at Good Times [4] - The management expressed confidence in operational improvements and the potential for increased sales through better marketing and communication of brand stories [10] - There are concerns about macroeconomic factors affecting sales, particularly demographic and geographic influences [30] Other Important Information - The company incurred $200,000 in capital expenditures related to restaurant remodels and signage projects during the quarter [19] - The company repurchased 21,968 shares under its share repurchase program, although future purchases may be reduced as cash accumulation is prioritized [18] Q&A Session Summary Question: CapEx and EBITDA expectations - Management indicated that they are not providing forward guidance on EBITDA but noted that the current quarter's EBITDA of $2.2 million is among the highest [22][23] Question: Good Times underperformance - Management attributed the underperformance to several factors, including heavy discounting by competitors and demographic challenges [30][31] Question: Share repurchase acceleration - Management suggested that any acceleration in share repurchases would likely occur in fiscal 2026, depending on macro factors and internal forecasts [33] Question: Special projects for fiscal 2026 - Management outlined plans for completing remodels at Good Times and replacing the point of sale system at Bad Daddy's as part of their capital plan [35][36]
Texas Roadhouse(TXRH) - 2025 Q2 - Earnings Call Transcript
2025-08-07 22:00
Financial Data and Key Metrics Changes - Revenue for the second quarter grew to over $1,500,000,000 for the first time in company history, representing a 12.7% increase year-over-year [5][17] - Same store sales increased by 5.8%, driven by a 4% traffic growth and a 1.8% increase in average check [5][17] - Diluted earnings per share increased by 4% to $1.86 [17] - Restaurant margin dollars increased by 6.1% to $257,000,000, while restaurant margin as a percentage of total sales decreased by 108 basis points year-over-year to 17.1% [17][18] Business Line Data and Key Metrics Changes - Texas Roadhouse averaged approximately $172,000 in weekly sales, while Bubba's 33 averaged over $128,000 in weekly sales [6][7] - Jaggers delivered average weekly sales of nearly $76,000 in the second quarter [7] - The company plans to open approximately 30 company-owned restaurants this year, with a potential for double-digit openings for Bubba's next year [8][10] Market Data and Key Metrics Changes - Inflation for commodities was in line with expectations, with a full-year inflation guidance increased to approximately 5% due to higher beef inflation [14] - Labor inflation was also in line with expectations, with a full-year guidance lowered to approximately 4% [14] Company Strategy and Development Direction - The company is focused on a "people first" approach, emphasizing legendary food and service [11] - Plans to acquire additional franchise locations and continue expanding the Bubba's brand, aiming for 200 locations [7][10] - The company is committed to maintaining its capital allocation philosophy, prioritizing new restaurant development and existing restaurant care [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of operations and the commitment of the team, despite facing challenges [11] - The company is monitoring inflationary trends closely and adjusting strategies accordingly [14][28] - Management remains optimistic about the growth potential of Bubba's and Jaggers, with plans for increased openings in the coming years [42][126] Other Important Information - The company completed the acquisition of three franchised restaurants, bringing the total to 17 for the year, and plans to acquire three more in the fourth quarter [10] - The company is purchasing its support center buildings, which will save approximately $2,500,000 in rent annually [103] Q&A Session Summary Question: Insights on inflation dynamics - Management noted that strong retail demand for beef and tighter supply have driven inflation higher, with expectations of peak inflation in the third quarter [25][28] Question: Mix effect and consumer behavior - Negative mix pressure is primarily from the alcohol category, while positive trends are seen in entrees and mocktails [32][36] Question: Expectations for inflation in Q3 and Q4 - Anticipated commodity inflation could reach 7% in Q3, decreasing to 4-5% in Q4 [41] Question: Growth opportunities in California - The company is excited about acquiring remaining franchise units in California and plans to explore growth opportunities in the state [96][99] Question: Off-premise sales growth - Off-premise sales growth is attributed to improved operational efficiency, the mobile app, and better execution by staff [120][123] Question: Delivery considerations - Currently, the company is not pursuing delivery options broadly but is open to discussions based on individual unit needs [130][132]