S&P 500   5,123.41
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MarketBeat Week in Review – 4/8 - 4/12
It's almost April 15. Here's how to reduce stress and get your taxes done
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The craze for Masters gnomes is growing. Little golf-centric statue is now a coveted collector item
Diplomat tapped as Latvia's new foreign minister as incumbent quits following flights scandal
How O.J. Simpson burned the Ford Bronco into America's collective memory
S&P 500   5,123.41
DOW   37,983.24
QQQ   438.27
5 Trends You Need to Know This Quarter
MarketBeat Week in Review – 4/8 - 4/12
It's almost April 15. Here's how to reduce stress and get your taxes done
Nearing 50 Supreme Court arguments in, lawyer Lisa Blatt keeps winning
The craze for Masters gnomes is growing. Little golf-centric statue is now a coveted collector item
Diplomat tapped as Latvia's new foreign minister as incumbent quits following flights scandal
How O.J. Simpson burned the Ford Bronco into America's collective memory
S&P 500   5,123.41
DOW   37,983.24
QQQ   438.27
5 Trends You Need to Know This Quarter
MarketBeat Week in Review – 4/8 - 4/12
It's almost April 15. Here's how to reduce stress and get your taxes done
Nearing 50 Supreme Court arguments in, lawyer Lisa Blatt keeps winning
The craze for Masters gnomes is growing. Little golf-centric statue is now a coveted collector item
Diplomat tapped as Latvia's new foreign minister as incumbent quits following flights scandal
How O.J. Simpson burned the Ford Bronco into America's collective memory
S&P 500   5,123.41
DOW   37,983.24
QQQ   438.27
5 Trends You Need to Know This Quarter
MarketBeat Week in Review – 4/8 - 4/12
It's almost April 15. Here's how to reduce stress and get your taxes done
Nearing 50 Supreme Court arguments in, lawyer Lisa Blatt keeps winning
The craze for Masters gnomes is growing. Little golf-centric statue is now a coveted collector item
Diplomat tapped as Latvia's new foreign minister as incumbent quits following flights scandal
How O.J. Simpson burned the Ford Bronco into America's collective memory

Michael Burry Picked a Winner With GEN Restaurant Group

GEN Restaurant Group stock outlook

Key Points

  • GEN Restaurant Group is investing in growth and widening margin.
  • Insiders are buying the stock and helping it to rebound following mixed results. 
  • Famous short-seller Michael Burry bought GENK in Q4 2024, and it is a winner for Scion Asset Management. 
  • 5 stocks we like better than GEN Restaurant Group

GEN Restaurant Group NASDAQ: GENK hit the Marketbeat.com radar when insider buying spiked in Q1. As they say, one thing leads to another, such as discovering the company is (at least was) a pick by Scion Asset Management in Q4. Scion is owned and operated by well-known investor Michael Burry, so it is a notable purchase. Scion’s Q4 13F shows 154,142 shares, or about 4% of the float and 0.4% of the total shares outstanding. There are no dates on the 13-F to know what price he paid, but we can assume it was less than $11.50, and minimum gains are near 20% and likely to grow.

GEN Restaurant Group Turns Corner; Analysts Yawn

GEN Restaurant Group had a mixed quarter in FQ4, but one result offsets the other due to the cause and outlook for future results. The company reported $45.1 million in net revenue for a gain of 10.5% that outpaced the Marketbeat.com consensus by 300 basis points. The strength was caused by accelerated store openings offset by a 1.7% decline in comps. The decline in comps is not great but less than expected and offset by store growth. The decline in comp is due to economic conditions expected to improve over the next twelve months. 

The margin is where the report is weakest, but GAAP losses and weaker-than-expected adjusted earnings are due primarily to preopening expenses. Preopening expenses will remain a headwind to the margin for the foreseeable future, but two things offset the issue. The first is that store count is growing and providing a lever for earnings. 

The second is the company’s lean toward efficiency and new unit operating metrics, which are among the best in the industry, including significant improvement in restaurant-level margin. The bad news is that GAAP earnings are negative, $0.01, and a nickel short of expectation; the good news is that the company is building leverage for the future and is in excellent financial health. The balance sheet highlights include nearly tripling cash, assets growing 38%, relatively flat liabilities, and equity of $36,000,000, up from negative $6,000 last year.


Insider Buying In GEN Restaurant Group Coincides With Results

GEN Restaurant Group insiders started buying the stock heavily following the Q4 release. The CEO and a 10% shareholder made the first two purchases on the release day. Subsequent purchases were made in the following days by the other C-suite execs and major shareholders. Investors who purchased shares by the end of that week are up more than 50% and on track to double their money. 

Analysts may provide a headwind to the market. The four analysis tracked by Marketbeat.com peg the stock at a firm Buy but trimmed their price targets following the release. The new targets assume the stock is overvalued at the current levels but may not stand long. The company’s next earnings release is in six weeks, and the bar is set low. The analysts expect sequential and YOY growth but have been lowering their targets. The consensus of $48.05 assumes growth will slow to 6.5% compared to the 20% increase in store count last year and expectations for additional store openings this year. 

GEN Restaurant Group Spikes, Then Hits Resistance

GEN Restaurant Group hit bottom ahead of its Q4 release and has spiked since, but the melt-up may already be over. The market advanced another 15% to open the 3rd week of gains but failed to hold the move.  The market now shows resistance near a critical target that provided support in the past. If the market can’t get above that level soon, it will unlikely advance until another catalyst emerges. In this scenario, the restaurant stock could be rangebound until the Q1 release and afterward if the results do not align with expectations. 

GENK stock chart

Should you invest $1,000 in GEN Restaurant Group right now?

Before you consider GEN Restaurant Group, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and GEN Restaurant Group wasn't on the list.

While GEN Restaurant Group currently has a "Buy" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here

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Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
GEN Restaurant Group (GENK)
3.4368 of 5 stars
$9.55-1.1%N/AN/ABuy$14.33
Compare These Stocks  Add These Stocks to My Watchlist 

Thomas Hughes

About Thomas Hughes

  • tmhughes.writeon@gmail.com

Contributing Author

Technical and Fundamental Analysis

Experience

Thomas Hughes has been a contributing writer for MarketBeat since 2019.

Areas of Expertise

Technical analysis, the S&P 500; retail, consumer, consumer staples, dividends, high-yield, small caps, technology, economic data, oil, cryptocurrencies

Education

Associate of Arts in Culinary Technology

Past Experience

Market watcher, trader and investor for numerous websites. Founded Passive Market Intelligence LLC to provide market research insights. 


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