Brinker International Inc. (EAT) Cut to “Hold” at Zacks Investment Research
Brinker International Inc. (NYSE:EAT) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a research report issued to clients and investors on Friday.
According to Zacks, “Brinker International’s aggressive expansion strategies and sales building initiatives, like menu innovation, promotional offerings along with introduction of loyalty program, should boost comps. Additionally, Brinker’s increased focus on company-owned restaurants, which allows it to have full control over operations, is likely to enhance the bottom as well as the top line. Various operational, remodeling and digital initiatives undertaken by the company should further drive growth. Moreover, the company has positive record of earnings surprises in recent quarters. Estimates too have been mostly going up ahead of the company’s first-quarter fiscal 2017 earnings release. However, the company’s revenues missed the Zacks Consensus Estimate in five of the trailing six quarters, mainly due to traffic decline at its restaurants. Further, higher costs and slow growth at international markets remain a cause of concern.”
Several other research firms have also recently issued reports on EAT. Telsey Advisory Group raised their target price on Brinker International from $56.00 to $60.00 and gave the stock an “outperform” rating in a research note on Friday, August 12th. Maxim Group reissued a “buy” rating and issued a $58.00 target price (up from $55.00) on shares of Brinker International in a research note on Friday, August 12th. Royal Bank Of Canada raised their target price on Brinker International from $49.00 to $55.00 and gave the stock a “sector perform” rating in a research note on Friday, August 12th. BMO Capital Markets reissued a “hold” rating and issued a $47.00 target price on shares of Brinker International in a research note on Thursday, September 1st. Finally, Argus reissued a “hold” rating on shares of Brinker International in a research note on Thursday, August 18th. One research analyst has rated the stock with a sell rating, nineteen have given a hold rating and nine have issued a buy rating to the company. The company presently has a consensus rating of “Hold” and an average price target of $53.93.
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Shares of Brinker International (NYSE:EAT) traded down 1.03% during mid-day trading on Friday, hitting $49.99. The stock had a trading volume of 324,802 shares. Brinker International has a 52 week low of $43.20 and a 52 week high of $55.16. The firm has a market cap of $2.75 billion, a PE ratio of 14.62 and a beta of 0.26. The stock has a 50 day moving average price of $52.24 and a 200 day moving average price of $47.95.
Brinker International (NYSE:EAT) last announced its quarterly earnings data on Thursday, August 11th. The company reported $1.24 earnings per share (EPS) for the quarter, beating the Zacks’ consensus estimate of $1.23 by $0.01. Brinker International had a negative return on equity of 114.14% and a net margin of 6.16%. The firm had revenue of $881.70 million for the quarter, compared to analysts’ expectations of $881.43 million. During the same period last year, the firm earned $0.94 earnings per share. The company’s revenue for the quarter was up 15.4% compared to the same quarter last year. Equities research analysts expect that Brinker International will post $3.47 EPS for the current fiscal year.
The business also recently declared a quarterly dividend, which was paid on Thursday, September 29th. Stockholders of record on Friday, September 9th were issued a $0.34 dividend. This represents a $1.36 dividend on an annualized basis and a dividend yield of 2.69%. The ex-dividend date was Wednesday, September 7th. This is an increase from Brinker International’s previous quarterly dividend of $0.32. Brinker International’s dividend payout ratio (DPR) is currently 39.42%.
In related news, insider Steve Provost sold 11,000 shares of the stock in a transaction dated Wednesday, August 24th. The shares were sold at an average price of $54.56, for a total value of $600,160.00. Following the sale, the insider now directly owns 23,100 shares of the company’s stock, valued at approximately $1,260,336. The sale was disclosed in a filing with the SEC, which is available through this hyperlink. Also, insider Wyman Roberts sold 41,722 shares of the stock in a transaction dated Friday, August 12th. The shares were sold at an average price of $53.00, for a total transaction of $2,211,266.00. Following the completion of the sale, the insider now directly owns 114,746 shares in the company, valued at $6,081,538. The disclosure for this sale can be found here. 1.76% of the stock is currently owned by insiders.
A number of large investors have recently modified their holdings of the stock. First Mercantile Trust Co. acquired a new stake in shares of Brinker International during the third quarter worth approximately $321,000. Foundry Partners LLC boosted its stake in shares of Brinker International by 8.4% in the third quarter. Foundry Partners LLC now owns 169,206 shares of the company’s stock worth $8,533,000 after buying an additional 13,064 shares during the last quarter. Mason Street Advisors LLC acquired a new stake in shares of Brinker International during the second quarter worth approximately $1,157,000. Schwab Charles Investment Management Inc. boosted its stake in shares of Brinker International by 35.7% in the second quarter. Schwab Charles Investment Management Inc. now owns 272,426 shares of the company’s stock worth $12,404,000 after buying an additional 71,604 shares during the last quarter. Finally, Stifel Financial Corp boosted its stake in shares of Brinker International by 4.8% in the second quarter. Stifel Financial Corp now owns 39,007 shares of the company’s stock worth $1,776,000 after buying an additional 1,778 shares during the last quarter.
Brinker International Company Profile
Brinker International, Inc is engaged in the ownership, operation, development, and franchising of the Chili’s Grill & Bar (Chili’s) and Maggiano’s Little Italy (Maggiano’s) restaurant brands. The Company’s Chili’s operates Bar & Grill category of casual dining. Chili’s menu features authentic Fresh Mex and Fresh Tex cuisine, including signature items, such as Baby Back Ribs smoked in-house, Hand-Crafted Burgers served with house-made garlic dill pickles, Mix and Match Fajitas, Tableside Guacamole and house-made Chips and Salsa.
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