Texas Roadhouse's Q2 Earnings Forecast Raised by Stifel Analyst

Stifel analyst Chris O'Cull has raised the price target for Texas Roadhouse (TXRH) to $188 from $180, while maintaining a "Hold" rating. The analyst expects improved business performance, with comparable sales rising 5% in the first five weeks of Q2 and increased Q2 earnings per share forecast to $1.93. The average target price for TXRH is $192.32, with a high estimate of $220.00 and a low estimate of $165.00.

Stifel analyst Chris O'Cull has recently raised the price target for Texas Roadhouse (TXRH) to $188 from $180, while maintaining a "Hold" rating. This move comes amidst expectations of improved business performance for the company. According to O'Cull, comparable sales have risen by 5% in the first five weeks of Q2, and the analyst has increased the Q2 earnings per share (EPS) forecast to $1.93 [1].

The analyst's new price target of $188 is slightly higher than the current average target price for TXRH, which stands at $192.32, with a high estimate of $220.00 and a low estimate of $165.00. This adjustment reflects optimism regarding the company's ability to navigate inflationary pressures and maintain strong operational efficiency.

Texas Roadhouse's Q2 performance has been marked by a 3.1% traffic rebound, driven by strategic pricing and operational improvements. The company implemented a 1.4% menu price increase in early April 2025, contributing to a 5% surge in quarter-to-date comparable sales [1]. This disciplined approach to pricing has allowed the company to preserve margins while maintaining customer trust.

Operational efficiency has also been a key factor in Texas Roadhouse's resilience. The company has managed to offset margin contractions through productivity improvements and cost management, such as streamlined kitchen operations and optimized labor scheduling [1]. This operational rigor has enabled the company to adapt to macroeconomic headwinds and maintain a strong brand reputation.

The company's brand loyalty has further contributed to its growth. Despite a Q1 slowdown due to weather and influenza, Texas Roadhouse has seen a 3.1% traffic rebound in Q2, indicating enduring customer loyalty [1]. CEO Jerry Morgan has emphasized the brand's "legendary food and service" as a differentiator, a reputation that has withstood economic cycles.

While the analyst's new price target reflects optimism, investors should be mindful of potential risks. These include the possibility of over-reliance on pricing strategies, which could erode demand in a downturn, and macroeconomic shocks. However, Texas Roadhouse's disciplined approach to expansion and cost management mitigates these risks.

In conclusion, Stifel analyst Chris O'Cull's raised price target for Texas Roadhouse reflects expectations of improved Q2 performance, driven by strategic pricing, operational efficiency, and enduring brand loyalty. As the company prepares to report earnings on August 7, 2025, investors should carefully consider these factors and the broader market's appetite for resilient consumer stocks.

References:
[1] https://www.ainvest.com/news/texas-roadhouse-q2-traffic-rebound-margin-resilience-strategic-buy-earnings-2507/
[2] https://www.ainvest.com/news/texas-roadhouse-q2-earnings-preview-traffic-rebound-expected-2507/