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Is It The Right Time To Buy Texas Roadhouse Inc (NASDAQ:TXRH)?

Texas Roadhouse Inc (NASDAQ:TXRH), a hospitality company based in United States, saw a double-digit share price rise of over 10% in the past couple of months on the NasdaqGS. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s take a look at Texas Roadhouse’s outlook and value based on the most recent financial data to see if the opportunity still exists. See our latest analysis for Texas Roadhouse

Is Texas Roadhouse still cheap?

The stock is currently trading at US$64.19 on the share market, which means it is overvalued by 49% compared to my intrinsic value of $42.95. Not the best news for investors looking to buy! Furthermore, Texas Roadhouse’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.

What kind of growth will Texas Roadhouse generate?

NasdaqGS:TXRH Future Profit Apr 30th 18
NasdaqGS:TXRH Future Profit Apr 30th 18

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company’s future expectations. Texas Roadhouse’s earnings over the next few years are expected to increase by 61.91%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? TXRH’s optimistic future growth appears to have been factored into the current share price, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe TXRH should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping an eye on TXRH for a while, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for TXRH, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Texas Roadhouse. You can find everything you need to know about Texas Roadhouse in the latest infographic research report. If you are no longer interested in Texas Roadhouse, you can use our free platform to see my list of over 50 other stocks with a high growth potential.


To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.

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