UPDATE: Wunderlich Securities Initiates Texas Roadhouse at Hold on Fair Valuation
In a report published Tuesday, Wunderlich Securities analyst Robert Derrington initiated coverage on Texas Roadhouse (NASDAQ: TXRH) with a Hold rating and $27.00 price target.
In the report, Wunderlich Securities noted, “We are initiating coverage of Texas Roadhouse, Inc. (TXRH) with a Hold rating and a 12-18 month price target of $27, 10% above recent levels. We believe shares of TXRH appear fairly valued at recent levels, trading at 20.0x forward 12-month (FTM) EPS compared to its 5-year average of 16.7x and management's targeted total annual return in the mid-teen range. While management's disciplined business model, including steady same store sales (SSS) and 8%-10% annual unit growth are projected to fuel 10%-12% annual revenue growth and low-teen EPS, volatile consumer spending, competitive Casual Dining (CD) industry trends, and commodity inflation adds underlying risk to our projections and TXRH valuation.”
Texas Roadhouse closed on Monday at $24.55.
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