Wingstop Inc WING is scheduled to host an Investor Day presentation on Jan. 16 and management is likely to detail multiple catalysts that will translate to outperformance versus current expectations, according to Wedbush.
The Analyst
Nick Setyan upgraded Wingstop's stock from Neutral to Outperform with a price target lifted from $88 to $105.
The Thesis
Wingstop is sitting in an enviable position in the restaurant sector given its direct exposure to the growing popularity of chicken items and a focus on delivery, Setyan wrote in the note. This should help sustain same-store sales growth at industry-leading levels in 2020 and beyond.
In fact, Setyan thinks delivery alone could contribute more than 6% of incremental same-store sales in 2020 if management continues to focus on effective marketing programs. A Wedbush survey on all things delivery related found Wingstop's usage and awareness has room to improve versus its peers which implies a potential for sustained delivery growth.
The company's favorable positioning is also backed by three specific initiatives, including adding new delivery partners, growth in marketing spend and potential for increased throughput opportunities which were implemented in the U.K. market and now being tested in the domestic market.
Price Action
Shares of Wingstop traded higher by 3.3% to $87.58 at time of publication.
Related Links:
Analyst: Food Delivery Companies Have Room For Growth, But Face Cash-Burning Competition
Wedbush Downgrades Wingstop, Valuation Reflects Growth Momentum
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
date | ticker | name | Price Target | Upside/Downside | Recommendation | Firm |
|---|
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
