Chili's Grill & Bar and Maggiano's Little Italy parent Brinker International joined this month's list of new buys by the best mutual funds. That earned it a seat at the table next to fellow restaurant stocks Cheesecake Factory, Wingstop and Nathan's Famous,
Seasoned with average earnings growth of 179% over the last three quarters, the Dallas-based restaurateur has also landed a spot on the Investor's Business Daily Leaderboard watchlist. Brinker stock continues to taste-test a fresh breakout.
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Brinker Serves Up Impressive Growth
In the first quarter, Brinker delivered earnings growth of 115% to $2.66 per share. Sales rose 27% to over $1.42 billion. For the second quarter, analysts expect 18% revenue growth to around $1.42 billion, and 48% earnings growth to $2.38 per share.
For the full year, Wall Street forecasts 114% earnings growth to $8.78 a share.
With a 98 Composite Rating, Brinker stock ties Dutch Bros – Thursday's IBD Stock Of The Day – for top billing among restaurant stocks. Other group leaders include Texas Roadhouse, Wingstop, Cheesecake Factory and Nathan's Famous.
The group ranks a solid No. 24 out of the 197 industries IBD tracks.
Brinker has seen Chili's successfully eat into McDonald's market share for burgers, with an attractively priced offering that stacks up well against the increasingly expensive Big Mac meal.
Brinker Stock Teases Early Breakout
After bouncing back above its 50-day moving average last month, Brinker stock continues to prepare a potential new breakout. The restaurateur just put the finishing touches on a handle to offer a 177.91 entry.
The stock closed Monday's session up over 1% at 173.76. The relative strength line has risen to within striking distance of a 52-week high.
Other restaurant stocks in or near buy range include Texas Roadhouse, Cheesecake Factory, Darden Restaurants, Nathan's Famous and Dutch Bros.
Follow Matthew Galgani on X (formerly Twitter) at @IBD_MGalgani.
