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Wingstop Stock Soars 49% in a Month: Stay Invested or Cash Out?
ZACKSยท 2025-05-22 14:20
Core Viewpoint - Wingstop Inc. has experienced a significant share price increase of 49% over the past month, outperforming both the industry and the S&P 500 [1] Stock Performance - As of Wednesday, Wingstop's shares closed at $322.48, above its 52-week low of $204 and below its 52-week high of $433.86 [1] - The stock has shown strong performance compared to key industry rivals such as CAVA Group, Brinker International, and Dutch Bros [1] Technical Indicators - Wingstop is trading above its 50-day moving average, indicating robust upward momentum and price stability, reflecting positive market sentiment [5] Expansion Efforts - The company is aggressively expanding, with a record-setting opening of 126 net new restaurants in the first quarter [7] - Wingstop has raised its 2025 unit growth guidance to 16%-17%, equating to approximately 410-435 new locations globally [7] - There are over 2,000 committed restaurant agreements worldwide, highlighting sustained demand from domestic and international partners [8] Global Demand - A flagship restaurant opened in Kuwait set a record for the highest global weekly sales in the company's history during its first week of operations, showcasing strong brand resonance internationally [9] Operational Innovations - Wingstop is implementing AI-powered kitchen technology to modernize operations, aiming to reduce quote times and improve consistency [11] - More than 10% of the company's system is already operating above the new $3 million average unit volume target, indicating scalability [11] Financial Estimates - Estimates for Wingstop's 2025 earnings per share have increased from $3.66 to $3.89 in the past 30 days, with expected growth in earnings and sales of 6.3% and 16.6% year over year, respectively [13] Valuation Metrics - Wingstop's forward 12-month price-to-earnings ratio is 74.34, significantly higher than the industry's ratio of 25.88 and the S&P 500's ratio of 21.50, suggesting a premium valuation [16] Strategic Vision - The company is focused on achieving $3 million in average unit volumes and expanding to 10,000 restaurants globally, with strategies aligned with this vision [12] - Wingstop's strong fundamentals and strategic vision position it as a compelling investment opportunity for those seeking exposure to a high-growth restaurant brand [19]