EAT - Brinker International Should Continue To Outperform

2024-05-22 18:34:37 ET

Summary

• Brinker International is well-positioned for growth with improving key performance indicators and advertising initiatives driving sales.
• The company's revenue growth in Q3 was driven by menu price increases and improved brand awareness, offsetting negative guest traffic.
• EAT's margins benefited from menu price increases and operational improvements, and the company is expected to continue to offset inflationary headwinds.

Investment Thesis

Brinker International, Inc. ( EAT ) is well-positioned to deliver good growth in the near as well as long term. The company's sales should benefit from improving key performance indicators such as customer satisfaction, employee turnover, and social media buzz, which all are trending in the right direction. This should help restaurant traffic recovery in FY25 and beyond. In addition, the company should also benefit from advertising initiatives that are gaining good traction among customers and its focus on offering value meals. The company's good execution should help offset lower guest traffic due to an inflationary environment....

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