Fast-food chain Wendy’s (NASDAQ: WEN) will be announcing earnings results this Friday before market open. Here’s what investors should know.
Wendy's beat analysts’ revenue expectations last quarter, reporting revenues of $543 million, down 5.5% year on year. It was a slower quarter for the company, with full-year EBITDA guidance missing analysts’ expectations significantly and a miss of analysts’ same-store sales estimates.
Is Wendy's a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Wendy’s revenue to decline 1% year on year, improving from the 2.1% decrease it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Wendy's has missed Wall Street’s revenue estimates multiple times over the last two years.
Looking at Wendy’s peers in the traditional fast food segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Starbucks delivered year-on-year revenue growth of 8.8%, beating analysts’ expectations by 4.3%, and Dutch Bros reported revenues up 30.8%, topping estimates by 3.2%. Starbucks traded up 8.4% following the results.
Read our full analysis of Starbucks’s results here and Dutch Bros’s results here.
There has been positive sentiment among investors in the traditional fast food segment, with share prices up 3.7% on average over the last month. Wendy's is down 3.6% during the same time and is heading into earnings with an average analyst price target of $7.74 (compared to the current share price of $6.64).
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