EAT - Brinker International Darden and Bloomin' Brands called near-term winners by JPMorgan

JPMorgan upgrades Brinker International (EAT) to an Overweight rating from Neutral following the recent pull back in share price and what it calls the final innings of the casual dining rally. "We believe the casual dining rally is on its last legs, but like the short-term risk/reward that Brinker now offers." JP continues to value the stock at 7.0% 2023 free cash flow yield with ~$180M capex resulting in +$250M free cash flow. It is noted that Brinker engaged on menu/operational simplicity a few years before COVID-19 and had already achieved industry-leading G&A metrics. The firm also keeps Overweight ratings on Darden Restaurants (DRI) and Bloomin' Brands (BLMN) for what it expects to be an exceptional summer and fall period for the casual dining outperformers. See Seeking Alpha Quant Ratings across the restaurant sector.

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Brinker International, Darden and Bloomin' Brands called near-term winners by JPMorgan