Bank of America Securities analyst Sara Senatore has maintained their bearish stance on WEN stock, giving a Sell rating today.
Sara Senatore’s rating is based on a combination of factors including Wendy’s reliance on international markets for unit growth and the volatility expected in these markets. The company’s strategy to achieve EBITDA growth through increased systemwide sales and unit expansion, particularly in international markets, presents challenges given the anticipated fluctuations in demand outside the U.S.
Additionally, while Wendy’s aims to drive same-store sales growth through data-driven marketing and menu innovations, the competitive nature of the fast-food industry poses a significant hurdle. The company’s focus on improving franchisee economics and operational productivity is positive, but the need for substantial capital expenditure to support growth indicates potential limitations in organic expansion. These factors collectively contribute to the Sell rating, as the risks and uncertainties appear to outweigh the potential benefits.
In another report released today, Morgan Stanley also maintained a Sell rating on the stock with a $14.00 price target.