In a research report released today, Oppenheimer analyst Brian Bittner reiterated a Perform rating on shares of Texas Roadhouse Inc (NASDAQ:TXRH), after the company reported second-quarter earnings results, posting EPS of $0.30 that missed Street’s $0.37 estimates. The analyst has lowered ’15E/’16E EPS to $1.34/$1.64 from $1.44/ $1.68 owing primarily to lower restaurant margins.
Bittner wrote, “Despite a large EPS miss, top-line continues to be best in casual dining (+8% comps). This quarter highlights the ongoing bull/bear investment argument around TXRH; impressive comps, disappointing profit flow-through. Near-term beef costs were the culprit this quarter, but mgmt pointed to relief in 2H with extra help from an upcoming price increase, which could set up ’16 nicely.”
The analyst concluded, “We are attracted to TXRH’s strong business model, attractive unit growth and impressive SSS performance. But we remain at a Perform rating until we become confident in its transformation to a meaningful earnings upside story.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Brian Bittner has a total average return of 20.9% and a 79.8% success rate. Bittner is ranked #27 out of 3724 analysts.
Out of the 11 analysts polled by TipRanks, 9 rate Texas Roadhouse stock a Hold, while 2 rate the stock a Buy. With a downside potential of 10.3%, the stock’s consensus target price stands at $35.