Bullish indicating open at $55-$60, IPO prices at $37
Investing.com - UBS raised its price target on Wingstop (NASDAQ:WING) to $335.00 from $280.00 while maintaining a Neutral rating ahead of the company’s second-quarter earnings report scheduled for July 30. The stock, currently trading at $326.34, appears overvalued according to InvestingPro analysis, despite showing impressive revenue growth of 31% over the last twelve months.
The firm expects Wingstop to face pressure on same-store sales due to difficult comparisons and likely macroeconomic challenges, while maintaining solid underlying multi-year trends. UBS anticipates second-quarter same-store sales could decline between 2-4%, compared to the consensus estimate of a 4.3% decrease.
UBS projects that Wingstop will reiterate its 2025 same-store sales guidance of approximately 1%, with investor focus remaining on recently softer sales trends and factors impacting consumer demand, as well as implications for growth in the second half of the year.
The firm anticipates trends should improve in the fourth quarter and into 2026, supported by the Smart Kitchen rollout and other growth drivers including brand awareness opportunities, menu innovation, digital and loyalty programs, delivery, and an upcoming loyalty program launch.
The price target increase reflects expanding valuation multiples across the restaurant sector and an anticipated improvement in sales trends from April levels, with UBS noting Wingstop remains well positioned for industry-leading average unit volume growth and store development expansion over the coming years.
In other recent news, Wingstop has made significant strides in various areas. The company announced updates to its corporate governance structure, including the declassification of its Board of Directors and the elimination of supermajority voting provisions. These changes were approved by stockholders at the 2025 Annual Meeting and took effect following the filing with the Secretary of State of Delaware. In terms of financial analysis, TD Cowen raised its price target for Wingstop to $400 from $330, maintaining a Buy rating, and highlighted the impact of smart kitchen technology on future sales growth. BTIG also reiterated a Buy rating with a $430 price target, emphasizing Wingstop’s tech investments and international expansion as key growth drivers. Melius Research initiated coverage with a Hold rating, citing Wingstop’s strong growth but noting the current stock price fairly reflects its long-term earnings trajectory. Additionally, TD Cowen revised its same-store sales growth projections, expecting a 6% increase for both fourth-quarter 2025 and full-year 2026. These developments indicate a strategic focus on technology and governance, aligning with Wingstop’s growth ambitions.
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