Wingstop (NASDAQ:WING) Trading Down 5.3% After Analyst Downgrade

Key Points

• Wingstop shares fell 5.3% after Sanford C. Bernstein downgraded the stock to “market perform” and cut its price target from $220 to $155.
• Analyst sentiment remains broadly positive, with a “Moderate Buy” consensus and an average price target of $241.81, despite several recent rating and target reductions.
• Wingstop exceeded quarterly EPS expectations but missed revenue estimates; the company also raised its quarterly dividend to $0.33 per share, implying a 1.1% annual yield.

Wingstop Inc. (NASDAQ:WING - Get Free Report)'s stock price fell 5.3% on Tuesday after Sanford C. Bernstein downgraded the stock from an outperform rating to a market perform rating. Sanford C. Bernstein now has a $155.00 price target on the stock, down from their previous price target of $220.00. Wingstop traded as low as $122.00 and last traded at $123.5280. Approximately 532,442 shares changed hands during mid-day trading, a decline of 54% from the average daily volume of 1,161,075 shares. The stock had previously closed at $130.39.

Several other analysts have also issued reports on the stock. Morgan Stanley cut their price target on shares of Wingstop from $255.00 to $238.00 and set an "overweight" rating for the company in a research report on Thursday, July 30th. The Goldman Sachs Group cut shares of Wingstop from a "buy" rating to a "neutral" rating and cut their target price for the stock from $290.00 to $190.00 in a report on Thursday, April 30th. Piper Sandler set a $173.00 price target on shares of Wingstop in a research report on Wednesday, July 29th. Weiss Ratings downgraded shares of Wingstop from a "hold (c)" rating to a "hold (c-)" rating in a research note on Wednesday, May 6th. Finally, Wall Street Zen upgraded Wingstop from a "sell" rating to a "hold" rating in a report on Tuesday, July 14th. One equities research analyst has rated the stock with a Strong Buy rating, twenty-two have assigned a Buy rating, six have issued a Hold rating and one has given a Sell rating to the company. According to MarketBeat, Wingstop currently has an average rating of "Moderate Buy" and an average price target of $241.81.

Institutional Investors Weigh In On Wingstop

Several hedge funds have recently bought and sold shares of the business. Oppenheimer Asset Management Inc. bought a new position in Wingstop in the 2nd quarter worth about $1,854,000. Daiwa Securities Group Inc. purchased a new stake in shares of Wingstop during the 2nd quarter valued at about $919,000. Lecap Asset Management Ltd. bought a new stake in shares of Wingstop in the second quarter worth approximately $360,000. Swiss Life Asset Management Ltd raised its holdings in shares of Wingstop by 9.8% during the second quarter. Swiss Life Asset Management Ltd now owns 1,719 shares of the restaurant operator's stock valued at $298,000 after purchasing an additional 153 shares during the last quarter. Finally, Ausbil Investment Management Ltd bought a new position in Wingstop during the second quarter valued at approximately $1,085,000.

Wingstop Stock Down 4.8%

The stock's fifty day simple moving average is $151.91 and its 200 day simple moving average is $186.56. The firm has a market capitalization of $3.38 billion, a PE ratio of 29.50, a PEG ratio of 1.55 and a beta of 1.81.

Wingstop (NASDAQ:WING - Get Free Report) last issued its quarterly earnings data on Wednesday, July 29th. The restaurant operator reported $1.18 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.02 by $0.16. Wingstop had a negative return on equity of 16.31% and a net margin of 16.15%.The business had revenue of $185.56 million for the quarter, compared to the consensus estimate of $190.25 million. During the same period in the prior year, the business posted $1.00 earnings per share. The company's quarterly revenue was up 6.5% compared to the same quarter last year. On average, analysts predict that Wingstop Inc. will post 4.48 EPS for the current year.

Wingstop Increases Dividend

The business also recently announced a quarterly dividend, which will be paid on Saturday, September 5th. Investors of record on Saturday, August 15th will be paid a $0.33 dividend. This is a boost from Wingstop's previous quarterly dividend of $0.30. The ex-dividend date is Friday, August 14th. This represents a $1.32 dividend on an annualized basis and a yield of 1.1%. Wingstop's dividend payout ratio (DPR) is 28.50%.

About Wingstop

Wingstop Inc NASDAQ: WING is a fast-casual restaurant chain specializing in chicken wings and related menu items. Founded in 1994 in Garland, Texas, the company has built its brand around bold, chef-inspired wing flavors and a streamlined service model that caters to dine-in, takeout, delivery and catering orders.

The company's core offerings include both bone-in and boneless chicken wings tossed in a variety of proprietary rubs and sauces, such as Original Hot, Lemon Pepper, and Mango Habanero.

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