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Wingstop Among Restaurant Stocks That Could Fly High, While Others Are Grounded

Wingstop Among Restaurant Stocks That Could Fly High, While Others Are Grounded

While investors may be wondering if the rally in full-service restaurant stocks is over and if it is time to invest in quick-service restaurant stocks, this is not an “either/or decision,” according to Stephens & Co.

The Wingstop Analyst: James Rutherford maintained an Overweight rating for Wingstop Inc (NASDAQ: WING), with the price target unchanged at $172.

The Wingstop Thesis: Poor weather conditions in February were favorable for delivery and drive-thru restaurant stocks, Rutherford said in the note.

This was reflected in Wingstop’s first-quarter comps, which handsomely surpassed expectations, he added.

Investors seem to be underestimating the positive impact of the reopening on drive-thru stocks, the analyst noted.

The Stephens & Co. analyst placed the following are full-service, drive-thru, delivery and takeout restaurants in these categories:

Full-service stocks with significant multiple expansion potential:

  • BJ's Restaurants, Inc (NASDAQ: BJRI)
  • Brinker International, Inc. (NYSE: EAT)
  • Denny's Corp (NASDAQ: DENN)
  • Ruth's Hospitality Group, Inc. (NASDAQ: RUTH)
  • Kura Sushi USA Inc (NASDAQ: KRUS)
  • Darden Restaurants, Inc. (NYSE: DRI)

Full-service stocks that seem to be too expensive

  • Cheesecake Factory Inc (NASDAQ: CAKE)
  • Texas Roadhouse Inc (NASDAQ: TXRH)
  • Chuy's Holdings Inc (NASDAQ: CHUY)

Drive-thru stocks with potential

  • McDonald’s Corp (NYSE: MCD)
  • Wendy’s Co (NASDAQ: WEN)

Delivery/takeout stocks with potential

  • Papa John's Int'l, Inc. (NASDAQ: PZZA)
  • Wingstop Inc (NASDAQ: WING)

(Photo: Wingstop)

Latest Ratings for WING

May 2021Wells FargoMaintainsOverweight
Apr 2021BarclaysMaintainsOverweight
Apr 2021Morgan StanleyMaintainsEqual-Weight

View More Analyst Ratings for WING
View the Latest Analyst Ratings


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Posted-In: Fast Food James RutherfordAnalyst Color Reiteration Restaurants Small Cap Analyst Ratings General

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