Wingstop (NASDAQ:WING) Shares Climb 7.4% - Time to Buy?

Key Points

• Wingstop shares rose 7.4% to about $114.70 in mid-day trading, though volume was approximately 60% below the average session level.
• Analysts maintain a generally positive outlook, with an average rating of “Moderate Buy” and a $236.44 average price target, despite several recent target-price cuts and one downgrade to “market perform.”
• Wingstop’s latest quarter showed EPS of $1.18, beating estimates by $0.16, while revenue increased 6.5% year over year but fell short of consensus expectations. The company also raised its quarterly dividend to $0.33 per share.

Shares of Wingstop Inc. (NASDAQ:WING - Get Free Report) were up 7.4% during mid-day trading on Tuesday. The company traded as high as $115.10 and last traded at $114.7010. Approximately 470,812 shares changed hands during mid-day trading, a decline of 60% from the average session volume of 1,185,798 shares. The stock had previously closed at $106.84.

Analyst Upgrades and Downgrades

WING has been the subject of a number of research reports. Raymond James Financial reiterated a "strong-buy" rating and issued a $185.00 price target (down from $240.00) on shares of Wingstop in a research note on Friday, September 18th. Royal Bank Of Canada decreased their price target on Wingstop from $200.00 to $150.00 and set an "outperform" rating for the company in a research note on Thursday, September 17th. Sanford C. Bernstein lowered Wingstop from an "outperform" rating to a "market perform" rating and cut their target price for the stock from $220.00 to $155.00 in a research report on Monday, August 3rd. Citigroup restated a "buy" rating on shares of Wingstop in a research report on Thursday, September 17th. Finally, Stephens restated an "overweight" rating and issued a $200.00 price objective on shares of Wingstop in a report on Thursday, July 30th. Two research analysts have rated the stock with a Strong Buy rating, twenty-one have issued a Buy rating, five have issued a Hold rating and two have assigned a Sell rating to the company's stock. According to MarketBeat, Wingstop presently has an average rating of "Moderate Buy" and an average target price of $236.44.

Wingstop Stock Up 5.6%

The business has a fifty day moving average of $112.92 and a 200 day moving average of $141.98. The firm has a market cap of $3.07 billion, a P/E ratio of 26.93, a P/E/G ratio of 1.28 and a beta of 1.81.

Wingstop (NASDAQ:WING - Get Free Report) last released its quarterly earnings results on Wednesday, July 29th. The restaurant operator reported $1.18 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.02 by $0.16. The firm had revenue of $185.56 million for the quarter, compared to the consensus estimate of $190.25 million. Wingstop had a negative return on equity of 16.31% and a net margin of 16.15%.The company's revenue for the quarter was up 6.5% on a year-over-year basis. During the same quarter last year, the business posted $1.00 EPS. On average, sell-side analysts expect that Wingstop Inc. will post 4.49 EPS for the current fiscal year.

Wingstop Increases Dividend

The company also recently announced a quarterly dividend, which was paid on Saturday, September 5th. Stockholders of record on Saturday, August 15th were given a $0.33 dividend. This represents a $1.32 annualized dividend and a dividend yield of 1.2%. The ex-dividend date was Friday, August 14th. This is a boost from Wingstop's previous quarterly dividend of $0.30. Wingstop's dividend payout ratio is presently 31.35%.

Hedge Funds Weigh In On Wingstop

Several large investors have recently modified their holdings of the business. BlackRock Inc. acquired a new position in shares of Wingstop in the second quarter worth approximately $481,314,000. Darsana Capital Partners LP raised its position in shares of Wingstop by 20.0% during the second quarter. Darsana Capital Partners LP now owns 1,500,000 shares of the restaurant operator's stock worth $260,115,000 after purchasing an additional 250,000 shares during the period. Alyeska Investment Group L.P. lifted its stake in shares of Wingstop by 44.5% in the second quarter. Alyeska Investment Group L.P. now owns 942,943 shares of the restaurant operator's stock valued at $163,516,000 after buying an additional 290,501 shares in the last quarter. State Street Corp boosted its stake in Wingstop by 2.0% during the 2nd quarter. State Street Corp now owns 863,951 shares of the restaurant operator's stock valued at $149,751,000 after purchasing an additional 16,907 shares during the last quarter. Finally, Jupiter Topco LLC bought a new stake in Wingstop during the 2nd quarter worth approximately $147,440,000.

Wingstop Company Profile

Wingstop Inc is a restaurant company that specializes in made-to-order chicken wings and related menu items. Its offerings include classic and boneless wings prepared with a variety of signature flavors, as well as chicken sandwiches, tenders, seasoned fries, sides, dips and beverages. The company serves customers through dine-in, takeout, delivery and digital ordering channels.

Founded in 1994 in Garland, Texas, Wingstop has developed primarily as a franchised restaurant brand. The company supports its franchisees through brand marketing, restaurant development, operating systems, menu innovation and supply-chain coordination, while franchisees generally own and operate individual locations.

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