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6 Metrics Highlight Texas Roadhouse's Strong Momentum

Daniel Sparks, The Motley Fool

Texas Roadhouse (NASDAQ: TXRH) recently closed the books on an impressive 2018, reporting top-line growth and notable strength in the company's closely watched comparable-restaurant sales. Capturing the steakhouse's strong momentum, the end of the company's fourth quarter marked its 36th consecutive quarter of positive comparable-restaurant sales.

With Texas Roadhouse's fourth-quarter and full-year results behind it, it's a good time to zoom out and look at the company's overall performance in 2018. Here's insight on key metrics from the year, including Texas Roadhouse's double-digit revenue growth, big dividend increase, store openings, and more.

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Image source: Getty Images.

1. Revenue rose 10.7%

The casual-dining steakhouse's revenue rose 10.7% year over year in 2018 to $2.46 billion, only slightly slower than its 11.5% year-over-year revenue growth in 2017. 

The company's top-line growth notably picked up speed toward the end of the year, with revenue rising 11.2% year over year in Q4.

2. Earnings per share jumped 19.6%

Texas Roadhouse's earnings per share jumped 19.6% to $1.84, outpacing revenue growth. Much of this increase, however, was driven by a lowered tax rate as a result of new tax legislation. Texas Roadhouse's tax rate decreased from 26.1% in 2017 to 12.9% in 2018.

3. A 20% dividend increase

Along with its fourth-quarter results, Texas Roadhouse announced a 20% year-over-year increase to its quarterly dividend. This puts the company's dividend at $0.30. Translating to $1.20 in dividends annually, this gives Texas Roadhouse a forward dividend yield of 1.9%.

Management noted in its fourth-quarter and full-year update that this is the company's sixth consecutive year of increasing its dividend by a double-digit percentage.

4. Comparable-restaurant sales increased 5.4%

At its company-owned restaurants, Texas Roadhouse's comparable-restaurant sales were up 5.4%. At domestic franchise restaurants, comparable sales rose 4.3%. Both of these figures were an acceleration from 4.5% and 4.2% growth in comparable-restaurant sales at company and franchise restaurants in 2017, respectively.

5. 28 company restaurants were opened

Management remains confident in its ability to grow sales with new locations, opening 28 company restaurants in 2018. This is one more than the 27 company restaurants Texas Roadhouse opened in 2017.

In 2019, Texas Roadhouse expects to open 25 to 30 company restaurants.

6. Comparable sales are trending 6% higher in Q1

In the company's fourth-quarter earnings call, CFO Tonya Robinson highlighted promising strength in comparable-restaurant sales so far in 2019.

"For the first 54 days of 2019, comparable sales increased approximately 6%," Robinson said. But she also noted that 1.3 percentage points of this 6% increase was due to a calendar shift of the New Year's holiday.

Looking out to the full year of 2019, management noted it expects cost pressures in the near term but said it is "excited about the top-line momentum that our operators have generated."

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Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Texas Roadhouse. The Motley Fool has a disclosure policy.