BJ's Restaurants, Inc. BJRI reported impressive first-quarter fiscal 2023 (ended Apr 4, 2023) results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. Following the announcement, shares of the company moved up 2.4% during the after-hours trading session on Apr 27.
Greg Levin, chief executive officer and president, BJ's Restaurants, stated, “First quarter restaurant margins improved year-over-year by 280 basis points to 12.6%, driven by our solid sales performance, improving operational execution and additional benefits from our cost-savings initiatives. Generating profitable sales growth and expanding our restaurant margins remain our top priorities in 2023, and we are encouraged by the progress made against these goals to date.”
Earnings & Revenues
In the quarter under review, the company reported adjusted earnings per share (EPS) of 15 cents, surpassing the Zacks Consensus Estimate of 4 cents. In the prior-year quarter, the company reported an adjusted EPS of 6 cents.
BJ's Restaurants, Inc. Price, Consensus and EPS Surprise
BJ's Restaurants, Inc. price-consensus-eps-surprise-chart | BJ's Restaurants, Inc. Quote
Total revenues of $341.3 million beat the Zacks Consensus Estimate of $332 million. The top line increased 14.2% on a year-over-year basis.
Comparable restaurant sales in the fiscal first quarter increased 9% year over year compared with a rise of 33.9% reported in the prior-year quarter. The upside was primarily backed by growth in the dining room guest traffic and menu pricing initiatives.
Expenses & Operating Margins
During the fiscal first quarter, labor costs — as a percentage of sales — came in at 37.6%, down 130 basis points (bps) year over year. Occupancy and operating costs (as a percentage of sales) came in at 23.2%, down from 24% reported in the year-ago quarter. General and administrative expenses (as a percentage of sales) came in at 5.8% in the quarter compared with 6.1% reported in the prior-year quarter.
During the quarter, restaurant-level operating margin came in at 12.6% compared with 9.8% reported in the year-ago quarter.
As of Apr 4, 2023, BJ’s Restaurants owned and operated 216 casual dining restaurants (in 30 states). Year to date, the company has opened two new restaurants (in Orland Park, Illinois and San Antonio, TX) and reported solid sales with respect to the same. The company expects to open three new restaurants in fiscal 2023. It also emphasized on expanding its remodel initiative to more than 30 restaurants. The company remains steadfast in its commitment to expand its presence to at least 425 restaurants domestically.
As of Apr 4, 2023, cash and cash equivalents totaled $29.3 million compared with $24.9 million as of Jan 3, 2023. Total debt as of Apr 4, 2023, amounted to $60 million, flat sequentially.
Zacks Rank & Key Picks
BJ's Restaurants has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Zacks Retail-Wholesale sector are Arcos Dorados Holdings Inc. ARCO, Chuy's Holdings, Inc. CHUY, and Darden Restaurants, Inc. DRI.
Arcos Dorados currently sports a Zacks Rank #1 (Strong Buy). ARCO has a long-term earnings growth of 7.8%. Shares of the company have gained 9.1% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Arcos Dorados’ 2024 sales and EPS suggests growth of 7.8% and 14.7%, respectively, from the year-ago period’s levels.
Chuy’s Holdings carries a Zacks Rank #2 (Buy). CHUY has a trailing four-quarter earnings surprise of 19.1%, on average. Shares of CHUY have increased 36.8% in the past year.
The Zacks Consensus Estimate for Chuy’s Holdings 2023 sales and EPS suggests growth of 10.8% and 19%, respectively, from the year-ago period’s levels.
Darden carries a Zacks Rank #2. DRI has a long-term earnings growth rate of 10.1%. The stock has gained 14.8% in the past year.
The Zacks Consensus Estimate for Darden’s 2024 sales and EPS suggests growth of 5.4% and 9.9%, respectively, from the year-ago period’s reported levels.
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