Let’s dig into the relative performance of Cracker Barrel (NASDAQ:CBRL) and its peers as we unravel the now-completed Q1 sit-down dining earnings season.
Sit-down restaurants offer a complete dining experience with table service. These establishments span various cuisines and are renowned for their warm hospitality and welcoming ambiance, making them perfect for family gatherings, special occasions, or simply unwinding. Their extensive menus range from appetizers to indulgent desserts and wines and cocktails. This space is extremely fragmented and competition includes everything from publicly-traded companies owning multiple chains to single-location mom-and-pop restaurants.
The 13 sit-down dining stocks we track reported a mixed Q1. As a group, revenues beat analysts’ consensus estimates by 0.6% while next quarter’s revenue guidance was 2.3% below.
Luckily, sit-down dining stocks have performed well with share prices up 26.1% on average since the latest earnings results.
Cracker Barrel (NASDAQ:CBRL)
Known for its country-themed food and merchandise, Cracker Barrel (NASDAQ:CBRL) is a beloved American restaurant and retail chain that celebrates the warmth and charm of Southern hospitality.
Cracker Barrel reported revenues of $821.1 million, flat year on year. This print was in line with analysts’ expectations, and overall, it was a strong quarter for the company with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
Commenting on the third quarter results, Cracker Barrel President and Chief Executive Officer Julie Masino said, "Our third quarter performance exceeded our expectations and represents the fourth consecutive quarter of positive comparable store restaurant sales growth. We remain focused on executing our transformation plan and believe we are well-positioned to deliver a strong finish to the fiscal year."
The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $57.68.
Is now the time to buy Cracker Barrel? Access our full analysis of the earnings results here, it’s free.
Best Q1: Brinker International (NYSE:EAT)
Founded by Norman Brinker in Dallas, Brinker International (NYSE:EAT) is a casual restaurant chain that operates the Chili’s, Maggiano’s Little Italy, and It’s Just Wings banners.
Brinker International reported revenues of $1.43 billion, up 27.2% year on year, outperforming analysts’ expectations by 2.6%. The business had an exceptional quarter with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ same-store sales estimates.
Brinker International delivered the highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 8.3% since reporting. It currently trades at $174.
Is now the time to buy Brinker International? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: First Watch (NASDAQ:FWRG)
Based on a nautical reference to the first work shift aboard a ship, First Watch (NASDAQ:FWRG) is a chain of breakfast and brunch restaurants whose menu is heavily-focused on eggs and griddle items such as pancakes.
First Watch reported revenues of $282.2 million, up 16.4% year on year, in line with analysts’ expectations. It was a softer quarter as it posted full-year EBITDA guidance missing analysts’ expectations.
As expected, the stock is down 14.1% since the results and currently trades at $15.97.
Read our full analysis of First Watch’s results here.
Darden (NYSE:DRI)
Founded in 1968 as Red Lobster, Darden (NYSE:DRI) is a leading American restaurant company that owns and operates a portfolio of popular restaurant brands.
Darden reported revenues of $3.16 billion, up 6.2% year on year. This result missed analysts’ expectations by 1.7%. Overall, it was a slower quarter as it also recorded a slight miss of analysts’ same-store sales estimates.
Darden had the weakest performance against analyst estimates among its peers. The stock is up 16.7% since reporting and currently trades at $219.63.
Read our full, actionable report on Darden here, it’s free.
Red Robin (NASDAQ:RRGB)
Known for its bottomless steak fries, Red Robin (NASDAQ:RRGB) is a chain of casual restaurants specializing in burgers and general American fare.
Red Robin reported revenues of $392.4 million, flat year on year. This print surpassed analysts’ expectations by 1.3%. It was a very strong quarter as it also put up an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
The stock is up 103% since reporting and currently trades at $6.38.
Read our full, actionable report on Red Robin here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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