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Noodles & Co. (NDLS)
NASDAQ:NDLS
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Noodles & Co
(NASDAQ:NDLS)
42Neutral
Noodles & Co (NDLS) vs. S&P 500 (SPY)
Market Cap
$55.80M
Dividend YieldN/A
Average Volume (3M)177.46K
Price to Earnings (P/E)―
Beta (1Y)1.70
Revenue Growth-2.01%
EPS Growth-267.04%
CountryUS
Employees7,600
SectorConsumer Cyclical
Sector Strength50
IndustryRestaurants & Bars
Share Statistics
EPS (TTM)-0.80
Shares Outstanding45,738,007
10 Day Avg. Volume151,744
30 Day Avg. Volume177,457
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.11
Price to Cash Flow (P/CF)-1.40
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$3.00Price Target Upside180.37% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Noodles & Co Business Overview & Revenue Model
Company DescriptionNoodles & Co. develops and operates fast-casual restaurants which offers lunch and dinner meals. It serves cooked-to-order dishes, which include noodles and pasta, soups, salads, sandwiches, and appetizers. The company was founded by Aaron Kennedy in 1995 and is headquartered in Broomfield, CO.
How the Company Makes MoneyNoodles & Company generates revenue primarily through the sale of food and beverages at its restaurant locations. The company operates a combination of company-owned and franchised stores, with the majority of revenue coming from company-owned restaurants. Additionally, Noodles & Company benefits from digital sales through its online ordering platform and mobile app, which facilitate takeout and delivery options. The company also engages in strategic marketing partnerships and loyalty programs to increase customer engagement and drive repeat business. Other revenue streams include franchise fees and royalties from franchised locations.
Noodles & Co Financial Statement Overview
Summary
Noodles & Co faces significant financial challenges with declining profitability, high leverage, and negative free cash flow. The income statement, balance sheet, and cash flow scores are all below average, highlighting the need for improved operational efficiency and financial restructuring.Income Statement
Noodles & Co has faced challenges with profitability as reflected in negative EBIT and net income figures in recent years. The gross profit margin shows a decline, and revenue growth is inconsistent, indicating potential operational inefficiencies.40
Negative
Balance Sheet
The company has a concerning negative stockholders' equity, indicating high leverage and financial instability. The debt-to-equity ratio is high, reflecting potential risk from heavy reliance on debt financing.30
Negative
Cash Flow
Operating cash flow remains positive, but free cash flow is negative, highlighting cash flow management issues. The operating cash flow to net income ratio indicates some ability to convert earnings into cash.45
Neutral
| Breakdown | ||||
| Dec 2024 | Mar 2024 | Mar 2023 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 493.27M | 503.40M | 509.48M | 475.15M | 393.65M | Gross Profit |
| 168.96M | 84.21M | 80.17M | 82.08M | 51.54M | EBIT |
| -27.78M | -5.03M | 5.33M | 11.54M | -13.49M | EBITDA |
| 1.29M | 21.76M | 22.44M | 28.15M | 1.68M | Net Income Common Stockholders |
| -36.21M | -9.86M | -3.31M | 3.67M | -23.26M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.15M | 3.01M | 1.52M | 2.25M | 7.84M | Total Assets |
| 304.46M | 368.10M | 343.84M | 341.46M | 353.63M | Total Debt |
| 188.78M | 300.41M | 264.16M | 249.78M | 280.42M | Net Debt |
| 187.63M | 297.40M | 262.64M | 247.52M | 272.58M | Total Liabilities |
| 330.23M | 340.94M | 305.48M | 303.83M | 323.93M | Stockholders Equity |
| -5.58M | 27.16M | 38.36M | 37.63M | 29.70M |
| Cash Flow | Free Cash Flow | |||
| -21.21M | -24.55M | -24.33M | 17.39M | -2.66M | Operating Cash Flow |
| 7.56M | 27.50M | 9.56M | 36.16M | 9.12M | Investing Cash Flow |
| -26.71M | -51.80M | -32.31M | -18.37M | -10.95M | Financing Cash Flow |
| 17.29M | 25.80M | 22.02M | -23.38M | -798.00K |
Noodles & Co Technical Analysis
Negative
1.07
Price Trends
1.22
Negative
1.05
Positive
1.32
Negative
Market Momentum
-0.02
Positive
42.76
Neutral
16.47
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NDLS, the sentiment is Negative. The current price of 1.07 is below the 20-day moving average (MA) of 1.44, below the 50-day MA of 1.22, and below the 200-day MA of 1.32, indicating a bearish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 42.76 is Neutral, neither overbought nor oversold. The STOCH value of 16.47 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NDLS.
Noodles & Co Risk Analysis
Noodles & Co disclosed 38 risk factors in its most recent earnings report. Noodles & Co reported the most risks in the “Ability to Sell” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Noodles & Co Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $67.74B | 44.92 | 45.67% | ― | 14.61% | 25.68% | |
68 Neutral | $3.69B | 370.51 | 2.23% | ― | 15.18% | -48.78% | |
67 Neutral | $1.51B | 18.24 | -20.16% | 3.97% | -3.57% | 2.31% | |
61 Neutral | $6.12B | 57.67 | -16.09% | 0.46% | 36.03% | 57.51% | |
59 Neutral | $12.41B | 10.34 | 1.32% | 3.61% | 1.65% | -18.04% | |
42 Neutral | $55.80M | ― | -335.60% | ― | -2.01% | -267.04% | |
41 Neutral | $78.95M | ― | 92.02% | ― | -4.19% | -266.52% |
* Consumer Cyclical Sector Average
Performance Comparison
NDLS
Noodles & Co
1.07
-0.73
-40.56%
CMG
Chipotle
50.05
-4.92
-8.95%
PZZA
Papa John's International
43.97
-22.32
-33.67%
RRGB
Red Robin Gourmet
4.57
-1.83
-28.59%
SHAK
Shake Shack
82.77
-20.93
-20.18%
WING
Wingstop
219.35
-129.68
-37.15%
Noodles & Co Earnings Call Summary
Earnings Call Date: Mar 6, 2025 | % Change Since: -13.71% | Next Earnings Date: May 7, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant improvements in sales, guest satisfaction, and strategic menu transformations, indicating positive momentum for Noodles & Company. However, these positives were offset by decreased revenue, increased costs, restaurant closures, and a reported net loss, balancing the overall sentiment.Highlights
Improvement in Sales and Traffic
Fourth-quarter system-wide comparable sales increased by 0.8%, with traffic nearly flat at -0.1%. The first quarter of 2025 saw over 3% comp sales growth with positive traffic.
Guest Satisfaction Increases
January saw the largest single-month increase in overall guest satisfaction, reducing the gap to the fast-casual industry average by almost 80% over the past twelve months.
Menu Transformation Success
The introduction of new menu items like Steak Stroganoff and three other dishes in October drove sales trends, with further improvements expected from new menu items in March.
Leadership Strengthening
Joe Cristina joined as President and COO, adding to leadership changes that include a new Chief Concept Officer and Executive Vice President of Marketing.
Lowlights
Decreased Revenue and Profitability
Total revenue decreased by 2% to $121.8 million in the fourth quarter. Restaurant-level contribution margin dropped from 14.7% to 11.2% compared to the same quarter last year.
Increased Costs
Cost of sales increased by 180 basis points, and labor costs rose by 30 basis points due to traffic deleverage and discounting.
Restaurant Closures
Six company-owned and three franchise restaurants were closed in the fourth quarter, with plans to close more in 2025 as part of a portfolio review.
Net Loss
The net loss for the fourth quarter was $9.7 million or $0.21 per diluted share, compared to a net loss of $6.1 million or $0.14 per diluted share last year.
Company Guidance
During the Noodles & Company's fourth quarter 2024 earnings call, the company provided guidance for 2025, emphasizing a transformative year ahead. Noodles & Company anticipates total revenue between $503 million and $512 million and mid-single-digit comparable restaurant sales growth. The restaurant contribution margin is expected to be between 12.5% and 14.0%, factoring in a 100 basis point investment in food costs due to a significant menu rollout in March. General and administrative expenses are projected to be between $49 million and $52 million. The company plans to open two new company-owned restaurants but will close 12 to 15 company-owned and four franchise restaurants. Capital expenditures are estimated at $11 million to $13 million, significantly lower than the previous year, allowing for a potential reduction in debt, which stood at $103 million at the end of 2024. The first quarter of 2025 has already shown promising trends with over 3% comp sales growth, despite February's weather challenges.Noodles & Co Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Noodles & Co Appoints Joe Christina as President and COO
Positive
Feb 19, 2025
Noodles & Company announced the appointment of Joe Christina as President and Chief Operating Officer on February 18, 2025. With over 30 years of experience in the restaurant industry, Christina is expected to enhance operations and human resources, leveraging his expertise to drive growth and innovation. His previous roles include significant leadership positions at Burger King and Church’s Chicken, where he successfully led brands to growth. Christina will oversee the introduction of a new menu and focus on operational excellence, menu innovation, and expanding catering services to unlock new growth opportunities. He succeeds Brad West, who retired as COO but will remain as Chief of Staff until June 2025 to ensure a smooth transition.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.