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Investing.com - UBS lowered its price target on Brinker International (NYSE:EAT) to $144.00 from $165.00 on Monday, while maintaining a Neutral rating on the restaurant operator’s stock ahead of its fiscal first-quarter earnings report. According to InvestingPro data, analyst targets for the $5.6 billion restaurant chain range from $144 to $215, with the stock currently showing signs of being undervalued based on Fair Value analysis.
The company, which owns Chili’s Grill & Bar and other restaurant chains, is expected to report its quarterly results on October 29, 2025, with UBS anticipating continued strong traffic and sales momentum reflecting ongoing execution of strategic initiatives.
Market expectations for Brinker’s fiscal first-quarter include Chili’s system same-store sales in the range of 20-24% compared to consensus estimates of 19.4% for company-owned locations, and adjusted earnings per share exceeding the consensus estimate of $1.76. The company maintains a "GREAT" Financial Health Score of 3.27 on InvestingPro, suggesting strong operational fundamentals.
UBS expects Brinker to raise its fiscal year 2026 guidance from the current revenue projection of $5.6-5.7 billion and adjusted earnings per share of $9.90-10.50, noting that the stock has declined approximately 30% since July 1, 2025, likely due to industry-wide valuation pressure and anticipated slower alternative data against difficult viral Triple Dipper comparisons.
The investment firm believes Brinker is positioned for continued sales gains and margin expansion opportunities due to multiple existing and upcoming sales initiatives that have proven highly effective, with momentum likely continuing through fiscal year 2026, while trading at what it considers a compelling valuation of approximately 12 times fiscal year 2026 estimated earnings per share.
In other recent news, Brinker International reported strong fourth-quarter fiscal 2025 earnings, with earnings per share of $2.49, surpassing the consensus estimate of $2.47. This performance was driven by robust comparable sales at its Chili’s restaurant chain, despite being partially offset by higher depreciation and amortization expenses. Piper Sandler raised its price target for Brinker International to $168, maintaining a Neutral rating, following impressive full-year results that included a 25% same-store sales growth and a 16% increase in traffic at Chili’s. Evercore ISI also increased its price target to $210 from $190 and upgraded the stock rating to Outperform, citing sustainable same-store sales growth potential. Stifel reiterated its Buy rating with a $215 price target, highlighting operational improvements and effective marketing at Chili’s as key growth drivers. Meanwhile, BMO Capital adjusted its price target to $170 from $150, maintaining a Market Perform rating, after reviewing the company’s latest earnings report. These developments reflect a positive outlook from multiple analyst firms on Brinker’s recent performance and growth strategies.
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