U.S. stocks lower as investors rotate out of tech ahead of Jackson Hole
On Wednesday, Jefferies maintained a Buy rating on Wingstop (NASDAQ:WING) shares, increasing the price target to $300 from $270. The firm’s analyst, Andy Barish, noted that Wingstop’s first-quarter same-store sales (SSS) grew by 0.5%, which was below the consensus estimate of 1.6%. Despite this, the company’s revenue was roughly in line with expectations due to a higher-than-anticipated number of new units opened, totaling 53 compared to the consensus forecast. InvestingPro data shows the company achieved impressive revenue growth of 36% over the last twelve months, though current analysis suggests the stock is trading above its Fair Value.
The analyst pointed out that April’s same-store sales showed a mid-single-digit percentage decline, which was expected by investors. Barish emphasized that this performance helps clarify the company’s trajectory after facing its most challenging comparison period and sets the stage for an anticipated acceleration in the second half of the year. This expectation is in line with Wingstop’s 2025 guidance, which forecasts a 1% growth. According to InvestingPro, the company maintains strong financial health with an overall score of "GREAT," and analysts have set price targets ranging from $181 to $385. Subscribers can access 12+ additional ProTips and comprehensive analysis in the Pro Research Report.
Barish also mentioned that Wingstop’s asset-light business model becomes increasingly attractive in the current uncertain economic environment. The visibility of incremental drivers is expected to improve, which, according to the analyst, should support a further re-rating of Wingstop’s stock.
In summary, Jefferies reiterates its Buy rating on Wingstop shares and raises the price target to $300, reflecting confidence in the company’s growth prospects and its ability to navigate the market effectively.
In other recent news, Wingstop Inc . reported its Q1 2025 earnings, surpassing analysts’ expectations with an earnings per share (EPS) of $0.99, compared to the forecast of $0.87. However, the company’s revenue slightly missed expectations, coming in at $171 million against the projected $172.5 million. Wingstop achieved record quarterly sales, with system-wide sales increasing by 15.7% to $1.3 billion. The company opened a record 126 net new restaurants during the quarter and saw digital sales grow to 72%. Additionally, Wingstop plans to launch a loyalty program in Q4 2025, with a system-wide expansion set for 2026. On the analyst front, the company’s operational strength and effective cost management were highlighted, despite a slight miss in revenue expectations. Wingstop’s strategic initiatives, including the deployment of the Wingstop Smart Kitchen technology in over 200 restaurants, contributed to increased efficiency. The company’s international expansion continues, with a notable new market opening in Kuwait, which set a record for highest global weekly sales.
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