Wingstop Inc. (NASDAQ:WING) Released Earnings Last Week And Analysts Lifted Their Price Target To US$310
It's been a good week for Wingstop Inc. (NASDAQ:WING) shareholders, because the company has just released its latest full-year results, and the shares gained 6.1% to US$339. Wingstop reported in line with analyst predictions, delivering revenues of US$460m and statutory earnings per share of US$2.35, suggesting the business is executing well and in line with its plan. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Check out our latest analysis for Wingstop
Taking into account the latest results, the most recent consensus for Wingstop from 22 analysts is for revenues of US$550.3m in 2024. If met, it would imply a meaningful 20% increase on its revenue over the past 12 months. Per-share earnings are expected to shoot up 25% to US$2.98. Before this earnings report, the analysts had been forecasting revenues of US$526.9m and earnings per share (EPS) of US$2.88 in 2024. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.
It will come as no surprise to learn that the analysts have increased their price target for Wingstop 14% to US$310on the back of these upgrades. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Wingstop, with the most bullish analyst valuing it at US$376 and the most bearish at US$139 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We can infer from the latest estimates that forecasts expect a continuation of Wingstop'shistorical trends, as the 20% annualised revenue growth to the end of 2024 is roughly in line with the 20% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 9.4% per year. So it's pretty clear that Wingstop is forecast to grow substantially faster than its industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Wingstop following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Wingstop analysts - going out to 2026, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 2 warning signs for Wingstop you should know about.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
