Latest news with #RRGB
Yahoo
2 days ago
- Business
- Yahoo
RRGB Q1 Earnings Call: New CEO Targets Traffic Growth Amid Margin Gains and Cost Discipline
Burger restaurant chain Red Robin (NASDAQ:RRGB) fell short of the market's revenue expectations in Q1 CY2025, with sales flat year on year at $392.4 million. Its non-GAAP profit of $0.19 per share was significantly above analysts' consensus estimates. Is now the time to buy RRGB? Find out in our full research report (it's free). Revenue: $392.4 million (flat year on year) Adjusted EPS: $0.19 vs analyst estimates of -$0.49 (significant beat) Adjusted Operating Income: $9.06 million vs analyst estimates of -$1.09 million (2.3% margin, significant beat) EBITDA guidance for the full year is $62.5 million at the midpoint, above analyst estimates of $58.86 million Adjusted EBITDA Margin: 7.1% Locations: 491 at quarter end, down from 505 in the same quarter last year Same-Store Sales rose 3.1% year on year (-6.5% in the same quarter last year) Market Capitalization: $89.87 million Red Robin's first quarter results were shaped by continued efforts to improve operational efficiency and guest experience, as outlined by outgoing CEO G.J. Hart and incoming CEO Dave Pace. Management attributed margin improvements to cost-saving initiatives, particularly in labor, and elevated food quality and hospitality. The company's revamped loyalty program, which now boasts over 15 million members, also contributed to higher guest engagement and frequency. CFO Todd Wilson emphasized that menu price increases offset declining traffic, resulting in improved profitability. Management noted satisfaction scores remained strong, suggesting that operational changes have not compromised guest experience. The leadership transition from Hart to Pace was described as smooth, with both leaders aligned on strategic priorities, including further enhancements to operations and focusing on sustainable growth. Looking ahead, Red Robin's guidance reflects a cautious approach in response to ongoing consumer headwinds and potential cost pressures, including tariffs. CEO Dave Pace outlined priorities such as sustaining operational improvements, reinvigorating traffic growth, and strengthening the company's financial position. Management is not planning further menu price increases this year, instead aiming to absorb cost pressures through continued efficiency gains. According to Pace, efforts to drive traffic will include strategic marketing and further leveraging the loyalty program, with newly appointed marketing leader Russ Klein set to refine brand messaging. CFO Todd Wilson cautioned that guest traffic trends from the first quarter are expected to persist, and the company will closely monitor the impact of current tariff policies. These factors underpin Red Robin's strategy to balance value for guests with disciplined financial management in the coming quarters. Management attributed margin gains to faster-than-expected labor efficiency and the successful rollout of operational improvements, while also highlighting challenges in traffic and a deliberate approach to menu pricing. Labor cost efficiencies: The operations team outperformed initial expectations in driving labor cost savings, which was the primary factor behind the adjusted profit exceeding internal goals. CFO Todd Wilson noted this efficiency did not come at the expense of guest satisfaction, which remained strong. Loyalty program impact: The relaunched Red Robin Royalty loyalty program continued to encourage guest visits, with 22% of visits from lapsed users and about 20% from new guests, suggesting the program is successfully driving frequency and attracting new diners. Menu pricing and check growth: Menu price increases contributed to higher average checks, compensating for a decline in guest traffic. Management expects the impact of menu pricing to decrease throughout the year, with no further price hikes planned for 2025. Strategic leadership transition: The handoff from G.J. Hart to Dave Pace was characterized by continuity in operational strategy, with both executives emphasizing ongoing investment in food quality, hospitality, and restaurant facilities. Russ Klein's appointment as marketing head signals a renewed focus on brand positioning. Restaurant closures and asset monetization: The company plans to close 10–15 underperforming locations in 2025, with closures evenly distributed through the year. Management is also monetizing owned properties to reduce debt, a move that supports financial flexibility and future investment. Red Robin's outlook is driven by a focus on guest engagement, cost management, and adapting to external pressures such as tariffs and consumer spending trends. Traffic recovery initiatives: Management intends to prioritize traffic growth through enhanced marketing strategies and further leveraging the loyalty program, seeking to reverse recent declines in guest visits without relying on additional menu price increases. Cost discipline amid tariffs: The company expects to absorb cost headwinds from tariffs rather than pass them on to customers, emphasizing continued labor and operating efficiencies to protect margins. This approach is intended to maintain value perception for guests. Restaurant reinvestment and network optimization: Planned reinvestment in restaurant facilities and technology, including potential upgrades like server handheld devices, is expected to support operational improvements and guest satisfaction. Ongoing closures of underperforming locations are designed to strengthen the overall health of the restaurant network. Looking forward, the StockStory team will be watching (1) whether Red Robin can stabilize or grow guest traffic through enhanced marketing and loyalty initiatives, (2) the company's ability to maintain cost efficiencies despite inflation and tariff pressures, and (3) progress on restaurant facility investments and the pace of underperforming store closures. Effective execution on these priorities will be critical for sustainable profitability and strengthening the brand's competitive position. Red Robin currently trades at a forward EV-to-EBITDA ratio of 1.4×. Should you double down or take your chips? Find out in our full research report (it's free). Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
26-05-2025
- Business
- Yahoo
Gear Up for Red Robin (RRGB) Q1 Earnings: Wall Street Estimates for Key Metrics
The upcoming report from Red Robin (RRGB) is expected to reveal quarterly loss of $0.57 per share, indicating an increase of 28.8% compared to the year-ago period. Analysts forecast revenues of $387.4 million, representing a decrease of 0.3% year over year. The consensus EPS estimate for the quarter has undergone a downward revision of 3.6% in the past 30 days, bringing it to its present level. This represents how the covering analysts, as a whole, have reassessed their initial estimates during this timeframe. Before a company announces its earnings, it is essential to take into account any changes made to earnings estimates. This is a valuable factor in predicting the potential reactions of investors toward the stock. Empirical research has consistently shown a strong correlation between trends in earnings estimate revisions and the short-term price performance of a stock. While investors typically use consensus earnings and revenue estimates as a yardstick to evaluate the company's quarterly performance, scrutinizing analysts' projections for some of the company's key metrics can offer a more comprehensive perspective. With that in mind, let's delve into the average projections of some Red Robin metrics that are commonly tracked and projected by analysts on Wall Street. The consensus estimate for 'Revenues- Restaurant revenue' stands at $376.61 million. The estimate points to a change of -0.5% from the year-ago quarter. The combined assessment of analysts suggests that 'Number of restaurants - Total' will likely reach 497. The estimate compares to the year-ago value of 505. The consensus among analysts is that 'Number of restaurants - Franchised' will reach 93. The estimate is in contrast to the year-ago figure of 92. Analysts' assessment points toward 'Number of restaurants - Company-owned' reaching 405. Compared to the current estimate, the company reported 413 in the same quarter of the previous all Key Company Metrics for Red Robin here>>>Shares of Red Robin have experienced a change of +15.7% in the past month compared to the +8.2% move of the Zacks S&P 500 composite. With a Zacks Rank #3 (Hold), RRGB is expected to mirror the overall market performance in the near future. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Red Robin Gourmet Burgers, Inc. (RRGB) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
