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El Pollo Loco Unveils Brand New Restaurant in Arizona

The leading fire-grilled chicken chain in the U.S., El Pollo Loco Holdings, Inc. LOCO, opened its latest outlet in Scottsdale, AZ, on Jun 12, 2017. This 2,995-square-foot restaurant, located at 7204 E. Shea Blvd., can accommodate 72 guests.

The outlet features the brand’s new ‘Vision Design’ and has an open kitchen layout to display the preparation of its signature dish. It marks El Pollo Loco’s second restaurant in Scottsdale and 24th in the greater Phoenix area.

El Pollo Loco currently has more than 470 company-owned and franchised restaurants in Arizona, California, Nevada, Texas and Utah. Also, it is looking to expand its presence in key markets like Oklahoma, New Mexico, Louisiana as well as Arkansas. The company has opened about 14 restaurants year to date with another eight slated to open in the coming weeks.

Going forward, the company expects to drive growth through a number of initiatives such as its authentic advertising campaign, highlighting the brand’s differentiated offering, its recently launched mobile and online ordering app as well as the future launch of a loyalty program. Meanwhile, menu innovation and limited time offers have been contributing to traffic at the restaurants.

Notably, shares of the company have outperformed the Zacks categorized Retail-Restaurants industry in the last one year. While El Pollo Loco shares rallied 22.2%, the industry witnessed a gain of 11.8%. Moreover, earnings estimates for current quarter and current year went up by 5.3% and 3%, respectively, over the past 60 days, reflecting the ongoing optimism in the stock.



However, while other restaurateurs like Yum! Brands, Inc. YUM, McDonalds Corporation MCD and Papa John’s International, Inc. PZZA are pursuing aggressive global expansion policies, El Pollo Loco loses out in terms of international presence.

Moreover, a challenging sales environment given lower consumer spending in the U.S. restaurant space remains a potent headwind to the company’s top line while high costs may hurt profits.

Nevertheless, we expect this Zacks Rank #3 (Hold) company’s continuous expansion plans to add immensely to the top line and boost its overall performance as well. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Click for Free Yum! Brands, Inc. (YUM) Stock Analysis Report >>
 
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Click for Free El Pollo Loco Holdings, Inc. (LOCO) Stock Analysis Report >>
 
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