Brinker International (EAT) Declines More Than Market: Some Information for Investors

Brinker International (EAT) closed the most recent trading day at $140.05, moving -1.91% from the previous trading session. The stock's change was less than the S&P 500's daily loss of 1.36%. Elsewhere, the Dow saw a downswing of 1.64%, while the tech-heavy Nasdaq depreciated by 1.46%.

The operator of restaurant chains Chili's Grill & Bar and Maggiano's Little Italy's stock has dropped by 12.59% in the past month, falling short of the Retail-Wholesale sector's loss of 0.82% and the S&P 500's loss of 1.76%.

Market participants will be closely following the financial results of Brinker International in its upcoming release. In that report, analysts expect Brinker International to post earnings of $2.86 per share. This would mark year-over-year growth of 7.52%. At the same time, our most recent consensus estimate is projecting a revenue of $1.48 billion, reflecting a 3.91% rise from the equivalent quarter last year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $10.68 per share and revenue of $5.81 billion, indicating changes of +20% and +7.93%, respectively, compared to the previous year.

Investors should also note any recent changes to analyst estimates for Brinker International. Recent revisions tend to reflect the latest near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.19% upward. Brinker International is currently sporting a Zacks Rank of #2 (Buy).

From a valuation perspective, Brinker International is currently exchanging hands at a Forward P/E ratio of 13.37. This represents a discount compared to its industry average Forward P/E of 20.22.

One should further note that EAT currently holds a PEG ratio of 1.01. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As of the close of trade yesterday, the Retail - Restaurants industry held an average PEG ratio of 1.92.

The Retail - Restaurants industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 163, which puts it in the bottom 34% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.

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Brinker International, Inc. (EAT): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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