First Watch (FWRG) Surges 10.98% on Q3 Earnings Beat and Aggressive Expansion—Is This a Volatility Play?

Summary
• First Watch (FWRG) jumps 10.98% to $17.59, driven by Q3 revenue growth of 25.6% to $316M and 7.1% same-store sales.
• Company raises FY25 adjusted EBITDA guidance to $123M, with 60–61 new restaurants planned by year-end.
• Intraday range spans $16.69 to $18.24, reflecting sharp volatility amid expansion optimism.
• Sector peers like McDonald’s (MCD) rise 0.88%, signaling broader restaurant sector momentum.

First Watch’s stock is surging on a rare 10.98% intraday rally, fueled by Q3 earnings that beat revenue estimates and aggressive expansion plans. The stock’s sharp move has outpaced broader market trends, with the company’s 25.6% revenue growth and 7.1% same-store sales growth capturing investor attention. As the restaurant sector gains traction with new concepts in Port St. Lucie, FWRG’s rally raises questions about its sustainability and volatility-driven opportunities.

Q3 Earnings and Expansion Fuel FWRG's 10.98% Rally
First Watch’s 10.98% surge stems from its Q3 2025 results, which showed 25.6% year-over-year revenue growth to $316M, driven by 7.1% same-store sales and 21 new restaurant openings. The company raised FY25 adjusted EBITDA guidance to $123M, exceeding Wall Street expectations. Investors are reacting to the 60–61 planned new restaurants and margin expansion to 19.7% at the restaurant level. Despite a $0.02 EPS miss, the focus on revenue growth and EBITDA optimism has driven the stock’s sharp move.

Restaurants Sector Gains Momentum as New Concepts Emerge
The Restaurants sector is seeing renewed interest as Port St. Lucie’s The Grove and other developments introduce new dining options. First Watch’s expansion aligns with broader trends of casual dining growth, particularly in Florida’s Treasure Coast. While McDonald’s (MCD) rose 0.88% on broader consumer confidence, FWRG’s rally reflects niche optimism around its daytime dining model and aggressive unit growth.

Options Playbook: FWRG20251121C17.5 and FWRG20251219C17.5 for Volatility-Driven Gains
• RSI: 33.06 (oversold)
• MACD: -0.191 (bearish divergence)
• Bollinger Bands: $14.95–$19.30 (current price near upper band)
• 200D MA: $17.63 (slightly above current price)

First Watch’s technicals suggest a short-term overbought condition, but the stock’s 10.98% rally has created momentum-driven options opportunities. Two top picks from the options chain are:

1. FWRG20251121C17.5
• Type: Call
• Strike: $17.50
• Expiration: Nov 21
• IV: 73.20% (high volatility)
• Delta: 0.524 (moderate sensitivity)
• Theta: -0.0497 (rapid time decay)
• Gamma: 0.1407 (high sensitivity to price swings)
• Turnover: 81,830 (liquid)
• Leverage: 15.82% (moderate)
• Payoff at 5% upside ($18.42): $0.92 per contract
• Why: High IV and gamma make this ideal for a short-term rally, with liquidity to enter/exit.

2. FWRG20251219C17.5
• Type: Call
• Strike: $17.50
• Expiration: Dec 19
• IV: 67.17% (moderate volatility)
• Delta: 0.547 (moderate sensitivity)
• Theta: -0.0249 (slower decay)
• Gamma: 0.0955 (moderate sensitivity)
• Turnover: 4,065 (liquid)
• Leverage: 10.55% (moderate)
• Payoff at 5% upside ($18.42): $0.92 per contract
• Why: Balances time decay with gamma for a mid-term play on continued expansion optimism.

Action: Aggressive bulls should prioritize FWRG20251121C17.5 for a short-term pop, while FWRG20251219C17.5 suits those betting on sustained momentum. Both contracts benefit from high IV and liquidity, but watch for a pullback to the 200D MA ($17.63) as a key support level.

Backtest First Watch Stock Performance
Here is a concise report of the event-driven back-test you requested, followed by a visual module you can open for full interactive details.Key conclusions (2022-01-01 ~ 2025-11-04):1. Sample size: Only 4 trading days met the “≥ +11 % intraday gain vs. prior close” filter. Limited events reduce statistical power— interpret with caution. 2. Short-term momentum: • Average excess return after 1 day ≈ +2.7 % (100 % win rate). • Positive drift persists to ~15 business days (peak ≈ +6.6 %). 3. Mean reversion: From day 17 onward the average event cohort gives back gains; by day 30 the cumulative excess return turns slightly negative (-2.2 %). 4. Significance: None of the horizons show statistical significance at conventional levels given the very small N. 5. Trading insight: A short tactical hold (≤ 10 trading days) captured most of the upside in past data; holding longer invited drawdown.Assumptions & auto-choices made for you:• “Intraday surge” approximated with daily close-to-close return ≥ +11 % because reliable intraday high/low series was unavailable. • Back-test window fixed to the full public life of FWRG (2022-present). • Default event analysis horizon = 30 trading days, a commonly used look-back for single-stock event studies.Open the interactive canvas on the right to explore daily curves, win-rate tables and event overlays.Let me know if you’d like to adjust the threshold, extend the horizon, or investigate additional tickers.

Bullish Momentum in Focus—Watch for $18.24 Intraday High Test
First Watch’s 10.98% rally is driven by Q3 earnings optimism and expansion plans, but technicals suggest a short-term overbought condition. The stock’s ability to hold above $17.63 (200D MA) and retest the $18.24 intraday high will determine if the move is sustainable. Investors should monitor the options chain for IV shifts and consider FWRG20251121C17.5 for a quick trade. Meanwhile, McDonald’s (MCD) rising 0.88% underscores sector strength. Act now: Buy FWRG20251121C17.5 if $17.59 holds; exit if the 200D MA breaks.