Royal Bank Of Canada Forecasts Strong Price Appreciation for Wendy's (NASDAQ:WEN) Stock

Key Points

• Royal Bank of Canada raised its Wendy’s price target from $7 to $8 but maintained a “sector perform” rating; the new target implies 1.84% downside from the prior close.
• Analyst sentiment is broadly cautious: Wendy’s has a consensus “Reduce” rating and an average price target of $7.56, with 1 Buy, 11 Hold, and 6 Sell ratings.
• Wendy’s quarterly EPS of $0.13 beat estimates of $0.09, but revenue of $435.62 million fell short of estimates and declined 0.5% year over year.

Wendy's (NASDAQ:WEN - Get Free Report) had its target price increased by equities researchers at Royal Bank Of Canada from $7.00 to $8.00 in a research note issued to investors on Monday, Benzinga reports. The firm currently has a "sector perform" rating on the restaurant operator's stock. Royal Bank Of Canada's price target would indicate a potential downside of 1.84% from the stock's previous close.

Other equities research analysts also recently issued reports about the company. Morgan Stanley set a $5.50 target price on Wendy's in a research report on Monday, August 10th. Weiss Ratings reiterated a "sell (d+)" rating on shares of Wendy's in a research report on Thursday, October 15th. Seaport Research Partners started coverage on Wendy's in a research note on Wednesday, September 16th. They issued a "neutral" rating on the stock. UBS Group dropped their price objective on Wendy's from $8.00 to $6.50 and set a "neutral" rating on the stock in a research note on Monday, October 26th. Finally, Guggenheim restated a "neutral" rating on shares of Wendy's in a report on Tuesday, September 15th. One analyst has rated the stock with a Buy rating, eleven have issued a Hold rating and six have issued a Sell rating to the company's stock. According to data from MarketBeat, Wendy's currently has a consensus rating of "Reduce" and an average price target of $7.56.

Wendy's Price Performance

Shares of NASDAQ WEN opened at $8.15 on Monday. The stock has a market cap of $1.55 billion, a P/E ratio of 15.98, a P/E/G ratio of 1.49 and a beta of 0.37. The firm's 50-day simple moving average is $6.95 and its 200 day simple moving average is $7.36. Wendy's has a fifty-two week low of $5.94 and a fifty-two week high of $10.12. The company has a quick ratio of 1.87, a current ratio of 1.89 and a debt-to-equity ratio of 27.00.

Wendy's (NASDAQ:WEN - Get Free Report) last announced its earnings results on Thursday, November 5th. The restaurant operator reported $0.13 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.09 by $0.04. The firm had revenue of $435.62 million during the quarter, compared to analyst estimates of $531.28 million. Wendy's had a net margin of 4.40% and a return on equity of 93.77%. Wendy's's revenue was down .5% compared to the same quarter last year. During the same quarter in the prior year, the firm posted $0.24 EPS. Equities analysts expect that Wendy's will post 0.50 EPS for the current year.

Institutional Trading of Wendy's

Several institutional investors and hedge funds have recently added to or reduced their stakes in the business. Global Retirement Partners LLC purchased a new stake in shares of Wendy's in the second quarter valued at $27,000. Cassaday & Co Wealth Management LLC purchased a new position in shares of Wendy's during the first quarter valued at $30,000. Sterling Capital Management LLC grew its holdings in shares of Wendy's by 630.5% during the third quarter. Sterling Capital Management LLC now owns 5,245 shares of the restaurant operator's stock valued at $33,000 after buying an additional 4,527 shares in the last quarter. Nykredit A S purchased a new position in shares of Wendy's during the second quarter valued at $37,000. Finally, Pavion Blue Capital LLC purchased a new position in shares of Wendy's during the third quarter valued at $64,000. 85.96% of the stock is owned by institutional investors and hedge funds.

Wendy's Company Profile

The Wendy's Company NASDAQ: WEN operates and franchises quick-service restaurants under the Wendy's brand. Its restaurants are known for hamburgers made with fresh, never-frozen beef, along with chicken sandwiches, salads, fries, breakfast items, desserts, and beverages.

Founded by Dave Thomas in 1969, Wendy's has grown into an international restaurant chain with locations primarily in the United States and Canada, as well as select markets in other countries. The company's restaurant system includes both company-operated and franchised locations.

In addition to its restaurant operations, Wendy's supports customers through digital ordering, delivery, loyalty programs, and mobile applications.

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