By Mark Kalinowski
Published on August 5, 2020 at 12:00 AM
Earlier today, Wendy’s (WEN; Buy, $23.81) reported adjusted EPS of $0.12, matching our recently-raised $0.12 forecast, and coming in one cent above sell-side consensus (according to Consensus Metrix) of $0.11. Although company-operated restaurantlevel margins in Q2 at 14.4% were down year-over-year, they still amounted to a figure above our 12.0% projection and consensus of 11.3%. Wendy’s cites “a higher average check, labor efficiencies, and other dining room closure related efficiencies” as positive factors. Management also pointed to quicker drive-thru speeds.
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By Mark Kalinowski
Published on August 4, 2020 at 12:00 AM
With this report, we upgrade the shares of Wendy’s (WEN) to Buy (from Neutral). The reasons for our upgrade include: (1) U.S. same-store sales trends that look better than the Street may expect (particularly for July, which may have positive implications for momentum for Q3 as a whole), (2) the possibility that the 5% or so of the Wendy’s worldwide store base that is company-owned produced higher-thananticipated restaurant-level margins in Q2 (and if so, what this may imply about the possibilities for such margins in Q3 and Q4), and (3) the recent nationwide launch of the Wendy’s Rewards loyalty program, which could help spur sales better than they otherwise would be through Q2 2021.
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By Mark Kalinowski
Published on May 6, 2020 at 12:00 AM
Earlier today, Wendy’s (WEN; Buy, $20.07) reported Q1 adjusted EPS of $0.09, ahead of our $0.07 forecast, and in line with sell-side consensus (according to Consensus Metrix) of $0.09. First-quarter adjusted EBITDA of $89.3 million matched consensus.
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