Bank of America Securities analyst Sara Senatore maintained a Buy rating on Wingstop (WING – Research Report) yesterday and set a price target of $404.00.
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Sara Senatore’s rating is based on Wingstop’s financial performance that exceeded expectations in terms of EBITDA and EPS, despite slightly missing the same-store sales growth projections. The company’s unit growth showed positive signs, with an increase in the number of units which offset the lower same-store sales growth, leading to a strong performance in high-margin franchise revenues.
Moreover, while there were higher costs associated with labor and cost of goods sold, these were partially mitigated by lower operating expenses and better-than-expected general and administrative costs. Wingstop’s conservative guidance for future same-store sales growth, combined with strong unit expansion and the potential benefits from increased advertising and the MyWingstop rollout, suggests room for positive surprises in the future, supporting the Buy rating.
In another report released yesterday, Barclays also maintained a Buy rating on the stock with a $359.00 price target.
WING’s price has also changed moderately for the past six months – from $384.940 to $265.020, which is a -31.15% drop .