Red Robin (RRGB) Provides Business Updates Amid Coronavirus
Red Robin Gourmet Burgers, Inc. RRGB recently provided an update on its business and initiatives that it is undertaking in response to the coronavirus pandemic.
To contain the spread of the virus, the company has temporarily closed 35 company-operated restaurants. Moreover, the company announced temporary pay cuts of 20% for all non-furloughed restaurant support center and restaurant supervisory team members, effective as of Apr 20, 2020, in an effort to reduce costs.
Paul J.B. Murphy III, Red Robin’s president and CEO, said “I’d like to thank all of our Team Members that have been working tirelessly to optimize our off-premise execution, grow our to-go, delivery, and catering channels, and deliver on the Red Robin brand promise to our communities.”
Shares of the company have fallen 64.1% in the past year, compared with the industry’s decline of 10.4%.
Revenues Declines Due to COVID-19
The company’s comparable restaurant revenues were up 3.4% quarter to date through Feb 23. Moreover, for the week ended Mar 1, comparable restaurant revenues inched up 0.9%. However, revenues started decline afterwards. For the week ended, Mar 8, Mar 15, Mar 22, Mar 29, Apr 5 and Apr 12, comparable restaurant revenues fell 3.7%, 26.3%, 72.7%, 70.5%, 63.9% and 65.2%, respectively.
Let’s look at earnings estimate revisions in order to get a clear picture of what analysts are thinking about the company. In the past 30 days, the Zacks Consensus Estimate for 2020 and 2021 earnings has declined $3.25 and $1.29, respectively.
The company currently has a Zacks Rank #3 (Hold).
Stocks to Consider
Some better-ranked stocks worth considering in the same space include BJ's Restaurants, Inc. BJRI, Dine Brands Global, Inc. DIN and Potbelly Corporation PBPB. All these stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
BJ's Restaurants and Potbelly have an impressive long-term earnings growth rate of 15% and 17.5%, respectively.
Dine Brands Global’s current-year earnings are likely to witness growth of 4%.
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