Brinker Serves Up Earnings Beat, Sidesteps Cost Pressures

Key Points

• Brinker International posted 20% revenue and 54% earnings growth, driven by strong same-store sales at Chili’s and Maggiano’s.
• Dine-in focus preserves margins, giving EAT an edge over fast-casual peers that are more reliant on lower-margin delivery and to-go sales.
• The stock trades at a sector discount with a double-digit earnings growth forecast, but it needs more volume to challenge its $189 all-time high.

Brinker International Inc. NYSE: EAT stock is surging over 2.5% on strong volume after the company’s strong second-quarter earnings report. The company reported strong, 21.3% same-store sales growth for its Chili’s and Maggiano’s chains.

Overall revenue came in at $1.46 billion, a 20% year-over-year (YOY) increase. The news was even better on the bottom line with the company posting 54% YOY growth. The earnings beat underscores the company’s ability to maintain pricing power and drive traffic despite a more cost-conscious consumer.

Despite the rally, EAT stock is still down overall for the last five days. Investors may believe the pre-earnings sell-off was overdone, but they may need more before confirming a new trend.

What Dining in Isn’t Saying

In the immediate hours after the report, the headline is that Brinker’s earnings prove that consumers are still dining out. That’s probably true. However, Brinker is also forecasting only a modest gain in same-store sales.

The company provided cautious guidance for the remainder of 2025, noting potential volatility in commodity costs. It also reinforced a focus on menu innovation, digital ordering, and loyalty programs to drive traffic and customer engagement. The loyalty program, in particular, continues to attract repeat customers, while digital channels are boosting average ticket sizes even as the overall share of off-premise sales remains modest.

Despite that outlook, investors are willing to reward EAT stock while it punished companies like CAVA Group and Chipotle Mexican Grill, which were punished after similar outlooks.

The key comes in the respective business models. Both companies offer dine-in, delivery, and to-go options. However, while Brinker noted that digital sales continue to become a larger part of the company’s business, it’s not nearly the same percentage as fast-casual names.

The takeaway is that Brinker’s dine-in-focused model preserves higher margins. Off-premise sales contribute to revenue growth, but aren’t as critical to overall profitability as they are for fast-casual names.

Does Brinker Stock Offer as Much Value as Its Restaurants

EAT stock has been one of the strongest-performing restaurant stocks over the past five years. However, that growth has been more pronounced in 2025 as some restaurant stocks face the reality of a weak consumer.

Despite those gains, Brinker still trades at an attractive valuation of just around 19x forward sales, a discount to the sector average. Adding to the bullish thesis is that analysts project 12.65% earnings growth over the next 12 months, which is well above the sector average. The company’s consistent track record of capital returns through buybacks and dividends also adds to shareholder appeal.

EAT Stock Is Moving, But the Rally Needs More Volume

The post-earnings move in EAT stock has erased the losses from the prior month. However, the stock still looks stuck in the range that it’s been in since June.

In the short term, investors should see if the stock can cross over its 50-day simple moving average (SMA).

Even if it does, the path back to the all-time high at $189 would require more volume and a clear breakout above intermediate resistance near $175.

That may have to wait until the fall. August tends to see a decline in volume, and September is one of the market’s worst months. Analysts have been raising their price targets for EAT stock in the last two months.

Investors will want to see if that continues post-earnings. The stock is currently trading near the consensus price target of $156.41, as reported by the analysts tracked by MarketBeat.