Red Robin Gourmet Burgers (NASDAQ:RRGB) plunged to a new 52-week low of $48.39 on May 20.
Shares of this Seattle, WA-based casual dining restaurant chain declined 22% despite reporting decent first-quarter 2016 results owing to a cut in full year sales and comps growth guidance.
Details of the Quarter
Red Robin reported mixed first-quarter 2016 results with earnings outperforming the Zacks Consensus Estimate but revenues missing.
Earnings rose 15.5% year over year on higher revenues and growth in adjusted EBITDA. Revenues of $402 million grew 1.8% year over year. However, comps were weak in the quarter.
Company-owned restaurants’ comps declined 2.6% as against prior-quarter comps growth of 2.1% due to weak traffic trends. A 4.1% decline in traffic offset a 1.5% increase in average guest check.
Restaurant-level operating profit margin decreased 50 basis points (bps) to 22.5%. Adjusted EBITDA rose 8.5% to $51.0 million from $47 million in the first quarter of 2015.
Full-Year Guidance Lowered
Red Robin lowered its total revenue growth guidance for 2016 from the range of 8.5% to 9.5% to 8%.
The comps growth guidance was lowered to flat to slightly negative from the previous expectation of an increase in a low single digit range.
Adjusted EBITDA in 2016 is likely to range between $150 million and $155 million.
Red Robin currently carries a Zacks Rank #4 (Sell).
Stocks to Consider
Stocks which are better-ranked in the same sector are Carrols Restaurant Group, Inc. (NASDAQ:TAST) , Dave & Buster's Entertainment, Inc. (NASDAQ:PLAY) , and Restaurant Brands International Inc. (NYSE:QSR) . All these stocks sport a Zacks Rank#1(Strong Buy).
RED ROBIN GOURM (RRGB): Free Stock Analysis Report
CARROLS RESTRNT (TAST): Free Stock Analysis Report
RESTAURANT BRND (QSR): Free Stock Analysis Report
DAVE&BUSTRS ENT (PLAY): Free Stock Analysis Report
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