Texas Roadhouse (TXRH) AI Stock Analysis

• Market Cap: $12.35B
• Dividend Yield: 1.31%
• Average Volume (3M): 1.30M
• Price to Earnings (P/E): 28.7
• Beta (1Y): 0.64
• Revenue Growth: 16.01%
• EPS Growth: 42.54%
• Country: US
• Employees: 91,000
• Sector: Consumer Cyclical
• Sector Strength: 53
• Industry: Restaurants & Bars
• EPS (TTM): 6.47
• Shares Outstanding: 66,450,645
• 10 Day Avg. Volume: 1,626,837
• 30 Day Avg. Volume: 1,295,222
• PEG Ratio: 0.68
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.30
• Price to Cash Flow (P/CF): 13.00
• P/FCF Ratio: 13.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $191.12
• Price Target Upside: 6.63% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 20

Texas Roadhouse has a strong financial performance with significant revenue growth and profitability. The stock faces some technical resistance and is trading at a premium valuation, indicating high growth expectations. The earnings call highlighted positive growth and strategic initiatives, although inflationary pressures pose some risks. Overall, the company is well-positioned for future growth, but investors should be cautious of valuation and inflation impacts.

Positive Factors

Earnings Performance

Texas Roadhouse reported 4Q24 operating results that were better than consensus expectations, with revenues outpacing estimates and delivering an EPS of $1.73 versus consensus of $1.64.

Shareholder Returns

Texas Roadhouse continues its focus on total shareholder return, with the Board of Directors announcing an 11% increase in the annual dividend and a new $500M share repurchase authorization.

Negative Factors

Cost Pressures

Management raised their forecast for commodity inflation, pointing to increased cost pressures from beef and other produce, which could lead to margin pressure if same-store sales remain below the 4% level.

Texas Roadhouse Business Overview & Revenue Model

Company Description

Texas Roadhouse, Inc. is a popular American restaurant chain specializing in casual dining, best known for its hand-cut steaks, fall-off-the-bone ribs, made-from-scratch sides, and freshly baked bread. Founded in 1993 and headquartered in Louisville, Kentucky, the company operates primarily in the United States, with a focus on providing a welcoming, family-friendly atmosphere that offers high-quality food at affordable prices. The chain operates under the brands Texas Roadhouse, Bubba's 33, and Jaggers.

How the Company Makes Money

Texas Roadhouse generates revenue primarily through the operation of its restaurants, where sales of food and beverages are the main source of income. The company's revenue model is based on high customer volume, driven by its reputation for quality, value, and service. Key revenue streams include dine-in sales, carry-out services, and catering options. Additionally, Texas Roadhouse benefits from its loyalty programs and gift card sales, which encourage repeat business. The company also engages in franchising some of its locations, providing an additional source of revenue through franchise fees and royalties. Overall, the company's earnings are bolstered by its strategic location selection, strong brand identity, and operational efficiencies that help maintain profitability.

Texas Roadhouse Financial Statement Overview

Summary

Texas Roadhouse presents a strong financial profile with notable revenue and profit growth, stable leverage ratios, and excellent cash flow generation. The company continues to expand its profitability and maintain a solid balance sheet, positioning it well for future growth. However, increasing debt levels should be monitored to ensure long-term financial stability.

Income Statement

Texas Roadhouse demonstrates robust revenue growth with a significant increase of 16% from 2023 to 2024. Gross profit margin is strong at 32.4%, and net profit margin has improved to 8.1%, indicating efficient cost management. The EBIT margin of 9.6% and EBITDA margin of 13% further reflect healthy operational performance. Overall, the income statement shows a trajectory of increasing profitability and growth.

Balance Sheet

The balance sheet of Texas Roadhouse is solid, with a manageable debt-to-equity ratio of 0.63. The company maintains a strong equity ratio of 42.6%, showcasing a stable financial position. Return on equity is impressive at 31.9%, indicating efficient use of shareholder funds. However, the total debt has increased, which could pose potential risks if growth slows.

Cash Flow

Texas Roadhouse shows strong cash flow performance, with a substantial increase in free cash flow from 2023 to 2024. The operating cash flow to net income ratio is robust at 1.74, while the free cash flow to net income ratio stands at 1.74, indicating excellent cash generation. Overall, the cash flow statement suggests effective cash management and a solid liquidity position.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
5.37B	4.63B	4.01B	3.46B	2.40B
	Gross Profit
947.26M	735.08M	653.63M	606.50M	283.59M
	EBIT
516.52M	353.99M	320.20M	297.19M	23.84M
	EBITDA
695.90M	507.47M	459.03M	424.69M	143.98M
	Net Income Common Stockholders
433.59M	304.88M	269.82M	245.29M	31.25M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
245.22M	104.25M	173.86M	335.64M	363.15M
	Total Assets
3.19B	2.79B	2.53B	2.51B	2.33B
	Total Debt
854.47M	773.69M	753.36M	722.89M	812.17M
	Net Debt
609.25M	669.44M	579.50M	387.25M	449.02M
	Total Liabilities
1.82B	1.64B	1.50B	1.44B	1.38B
	Stockholders Equity
1.36B	1.14B	1.01B	1.06B	927.50M
Cash Flow		Free Cash Flow
753.63M	217.95M	265.60M	268.13M	76.04M
	Operating Cash Flow
753.63M	564.98M	511.73M	468.83M	230.44M
	Investing Cash Flow
-336.90M	-367.17M	-263.73M	-195.10M	-161.10M
	Financing Cash Flow
-275.75M	-267.43M	-409.77M	-301.23M	185.94M

Texas Roadhouse Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 179.23
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TXRH, the sentiment is Neutral. The current price of 179.23 is above the 20-day moving average (MA) of 175.93, above the 50-day MA of 178.90, and above the 200-day MA of 176.58, indicating a bullish trend. The MACD of 0.86 indicates Negative momentum. The RSI at 51.06 is Neutral, neither overbought nor oversold. The STOCH value of 80.71 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TXRH.

Texas Roadhouse Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TXRH	78 Outperform	$12.35B	28.72	34.69%	1.31%	16.01%	42.54%
DRI	77 Outperform	$22.80B	22.32	50.93%	2.83%	5.14%	5.30%
CAKE	74 Outperform	$2.58B	15.60	41.18%	2.16%	4.13%	56.76%
BJRI	73 Outperform	$828.76M	52.95	4.54%	―	1.81%	-15.53%
EAT	73 Outperform	$6.67B	24.22	2390.91%	―	13.67%	69.41%
Sector *	60 Neutral	$13.01B	10.45	0.79%	3.53%	1.60%	-22.47%
BLMN	36 Underperform	$734.65M	―	-13.92%	11.10%	-7.42%	-153.35%

Texas Roadhouse Corporate Events

Texas Roadhouse Updates Executive Employment Agreements

Texas Roadhouse has entered into new employment agreements with several executive officers, effective January 8, 2025, with initial terms expiring in 2028 and automatic one-year renewals thereafter. These agreements include provisions for base salaries, incentive bonuses, and stock awards, with bonuses and awards contingent on achieving specific performance criteria. The agreements also outline separation and change of control terms and incorporate non-competition, confidentiality, and other restrictive covenants.