RCI Hospitality: Bombshells Still A Bombshell As Multiple Becomes More Attractive

2026-02-23 10:56:34 ET

RCI Hospitality's ( RICK ) Bombshells Restaurants and Bars continues to be an albatross on its neck with negative same-store sales and an unprofitable operating footprint that makes it hard to recommend a position in the company's common shares, even as it trades at a historically low multiple to trailing twelve months free cash flow. The potential of the full divestment of Bombshells represented a possible salvo for bulls, but the operating unit remains part of the financials, with RICK reporting fiscal 2026 first-quarter total revenue, which ended December 31, 2025, of $70.3 million . This is problematic because it dipped by 1.70% from revenue of $71.5 million in the year-ago comp. This dip was mainly driven by weakness in revenue from Bombshells, with management also pinning the blame for this quarter's weakness on the 2025 Government Shutdown. The company has previously blamed hot weather in Texas, with the bulk of its clubs and Bombshells restaurants located in the Lone Star State....

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