Shares of casual restaurant chain Brinker International (NYSE:EAT)
jumped 6.1% in the morning session after investors focused on the company's previously reported upbeat quarterly earnings from late October.
Brinker International (EAT) excels with 38% EBIT growth, 29% ROIC, and strong cash flow, making it a top pick for quality investors using the Caviar Cruise screening method.
Restaurants increase convenience and give many people a place to unwind. But it’s not all sunshine and rainbows as they’re notoriously hard to run thanks to perishable ingredients, labor shortages, or volatile consumer spending.
Unfortunately, these factors have spelled trouble for the industry as it has shed 14.4% over the past six months. This performance is a stark contrast from the S&P 500’s 17.2% gain.
Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.
Just because a business is in the green today doesn’t mean it will thrive tomorrow.
Brinker International’s third quarter saw strong sales growth and margin expansion, yet the market reacted negatively to the results. Management pointed to Chili’s continued momentum, driven by increases in guest traffic and successful menu and marketing initiatives. CEO Kevin Hochman highlighted the effectiveness of value-based promotions and product upgrades, such as the ribs and Margaritas platforms, as key contributors. However, challenges at Maggiano’s and ongoing cost pressures prevented more favorable sentiment among investors.
Shares of casual restaurant chain Brinker International (NYSE:EAT)
fell 3.8% in the afternoon session after investor sentiment soured amid weak earnings expectations for the company's upcoming quarterly report. Projections for the restaurant operator pointed to an 8.9% decline in earnings per share compared to the same period in the previous year. Adding to the concern, the consensus estimate for these earnings had been revised downward by 2.8% over the preceding 30 days. This change suggested a more pessimistic outlook on the company's near-term financial performance, which weighed on the stock.
Shares of casual restaurant chain Brinker International (NYSE:EAT)
fell 4.3% in the morning session after the company's weaker-than-expected full-year guidance continued to weigh on investor sentiment, a day after it reported quarterly results.
Casual restaurant chain Brinker International (NYSE:EAT) reported Q3 CY2025 results exceeding the market’s revenue expectations, with sales up 18.5% year on year to $1.35 billion. On the other hand, the company’s full-year revenue guidance of $5.65 billion at the midpoint came in 1.2% below analysts’ estimates. Its non-GAAP profit of $1.93 per share was 8.8% above analysts’ consensus estimates.
Brinker International (EAT) reported Q1 results above expectations with earnings of $1.93 per share and revenue of $1.35 billion. Chili's sales rose 21% and Maggiano's saw a decline.
Casual restaurant chain Brinker International (NYSE:EAT) reported Q3 CY2025 results beating Wall Street’s revenue expectations, with sales up 18.5% year on year to $1.35 billion. On the other hand, the company’s full-year revenue guidance of $5.65 billion at the midpoint came in 1.2% below analysts’ estimates. Its non-GAAP profit of $1.93 per share was 8.8% above analysts’ consensus estimates.
Brinker International (EAT) presents a value investing case with strong profitability, solid financial health, and attractive valuation metrics, trading below industry peers.
While strong cash flow is a key indicator of stability, it doesn’t always translate to superior returns.
Some cash-heavy businesses struggle with inefficient spending, slowing demand, or weak competitive positioning.
The stocks in this article have caught Wall Street’s attention in a big way, with price targets implying returns above 20%.
But investors should take these forecasts with a grain of salt because analysts typically say nice things about companies so their firms can win business in other product lines like M&A advisory.
Brinker International (EAT) aligns with a proven growth investing system, showing strong earnings surprises, surging sales, and a remarkable 103% return on equity.
