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Wingstop Inc. (WING)

NasdaqGS - NasdaqGS Real Time Price. Currency in USD
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163.77+1.22 (+0.75%)
At close: 4:00PM EDT

163.77 0.00 (0.00%)
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Previous Close162.55
Open162.56
Bid163.77 x 800
Ask172.24 x 1200
Day's Range161.06 - 165.18
52 Week Range44.27 - 165.18
Volume480,964
Avg. Volume703,207
Market Cap4.847B
Beta (5Y Monthly)1.17
PE Ratio (TTM)170.59
EPS (TTM)0.96
Earnings DateOct 28, 2020 - Nov 02, 2020
Forward Dividend & Yield0.56 (0.36%)
Ex-Dividend DateAug 27, 2020
1y Target Est161.36
Fair Value is the appropriate price for the shares of a company, based on its earnings and growth rate also interpreted as when P/E Ratio = Growth Rate. Estimated return represents the projected annual return you might expect after purchasing shares in the company and holding them over the default time horizon of 5 years, based on the EPS growth rate that we have projected.
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  • Hyper-Growth Wingstop Stock Could Be the Next McDonald’s
    InvestorPlace

    Hyper-Growth Wingstop Stock Could Be the Next McDonald’s

    Here's a fun fact: Of all the restaurant stocks in the world, relatively obscure Wingstop (NASDAQ:WING) stock has been the best performer on Wall Street.Source: Eric Glenn / Shutterstock.com By a mile.Over the past five years, Starbucks (NASDAQ:SBUX) stock has risen 32%. Yum! Brands (NYSE:YUM) stock has risen 50%. Chipotle Mexican Grill (NYSE:CMG) stock has also risen 50%. McDonald's (NYSE:MCD) stock has risen 100%. Domino's Pizza (NYSE:DPZ) stock has soared 240%.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThose are great returns. Especially the 240% pop in DPZ stock.But, all of those returns pale in comparison to what WING stock has done over the past five years.During that stretch, WING stock has surged 300% higher, making it not just the best performing restaurant stock out there, but also one of the best performing stocks in the whole market.This red-hot run in WING stock isn't over. Far from it. Instead, I think that in the long run, Wingstop has a real opportunity to become the next McDonald's. Buying WING stock today could be like buying MCD stock back in the late 1960s.To that end, I think WING stock is perhaps the best restaurant stock to buy for long-term investors.Here's why. Wingstop Can Be the Next McDonald'sFrom where I sit, Wingstop looks like the next McDonald's.McDonald's went from six locations in 1954 to nearly 40,000 restaurants today by doing four simple things.Selling the right product, at the right price, in the right format, and through the right channel.That is, McDonald's sold hamburgers in the 1960s, at a time when burger popularity was soaring nationally because it was seen as a patriotic American symbol amid the Cold War, and because Americans had started to adopt the idea of barbecues in their backyards.McDonald's sold those burgers for 15 cents, in a menu that was straightforward. * 10 Gaming Stocks That Will Power Through the New Normal And the company sold them mostly through drive-thru locations, on the heels of the 1956 Federal Highway Act, which paved the way for America to become highly motorized.Today, Wingstop is following almost identically -- and successfully -- in McDonald's footsteps.That is, the company is selling the right product, at the right price, in the right format, and through the right channel.Wingstop sells chicken wings, at a time when health-conscious consumers are pivoting from red meat consumption to higher-protein, less-fatty chicken consumption. Over the past decade, U.S. beef consumption per capita has dropped 5%, while chicken consumption per capita has risen 16%.Wingstop sell those wings at industry-low prices, and the menu is exceedingly simple.Most importantly, Wingstop sells its wings mostly through digital orders. Even before the novel coronavirus, more than 40% of the company's sales were digital. Now, it's on the heels of a global pandemic that has permanently accelerated consumer adoption of all things digital. WING Stock Has Tons of Growth PotentialBroadly, Wingstop has all the ingredients to be the next McDonald's.That's exciting news for WING stock, because Wingstop today is essentially where McDonald's was in the late 1960s.Wingstop operates just 1,436 restaurants today. McDonald's had that many restaurants back in the late 1960s.Wingstop has been growing its store base by 10%-plus per year over the past several years. Management thinks they can sustain 10%-plus unit growth for a lot longer, growing to over 6,000 stores globally at scale.Sure, that's a far cry from McDonald's near 40,000 locations today. But it still represents 4x growth from today's current base.Plus, Wingstop's average unit volumes are just $1.1 million today. That number is rapidly climbing -- up 15% last quarter -- but is still a far cry from average unit volumes at McDonald's ($2.8 million) and peer chicken restaurants like Chick-fil-A ($4.2 million) and El Pollo Loco ($1.8 million).In other words, Wingstop has a visible opportunity to simultaneously rapidly grow its store base and AUVs over the next 10-plus years. That's the sort of growth profile which could turn Wingstop into a top 10 restaurant brand globally one day -- and power WING stock to huge long-term gains. Momentum Is BuildingImpressively -- and importantly -- management is executing flawlessly against the restaurant chain's long-term opportunity, and momentum today is building, not slowing.Just look at last quarter's numbers.Same-store sales rose 32% year-over-year. Revenues rose 36%. System-wide sales rose 37%. Restaurant count rose 10%. Gross margins expanded 300 basis points. Operating margins expanded 840 basis points. Earnings per share more than doubled year-over-year.And that's all on top of double-digit comparable sales, revenue growth and unit growth in the same quarter one year ago.In other words, Wingstop is sustaining robust growth at scale.This is nothing new for the company.Wingstop has reported 16 consecutive years of positive comparable sales growth … including six years of 10%-plus comparable sales growth. This growth has led to average unit volumes essentially doubling over the past decade. And Wingstop has glided to industry-high 26% operating margins (versus 19% at McDonald's).What's the key to this success?You have an innovative management team that is relentlessly working to improve the customer experience, smartly expand the footprint and keep costs down.Specifically, this is a management team which leans heavily into purchase data analytics, digital marketing, and next-generation developments (like voice-activated ordering and carryout lockers) to sustain consistently robust comparable sales growth. It's also a management team that is hyper-focused on cost mitigation through striking long-term chicken pricing contracts and running a slim labor model thanks to the simple menu.So long as management continues to do everything right to capitalize on Wingstop's huge long-term growth opportunity, then WING stock will inevitably power higher. Wingstop Stock Has Big Upside PotentialAt the current WING stock price, Wingstop's market capitalization is $4.7 billion.In the long run, I see this as a $20 billion company.Here's the math.McDonald's has a $150 billion market cap. With 38,695 locations globally. In a mostly franchised model. Imputing a valuation in that mostly franchised model of nearly $4 million per store.Wingstop operates in a similar franchised model. At scale, if you look at peer chicken QSR AUVs, Wingstop stores should do more in sales than McDonald's stores. Plus, Wingstop stores have higher unit margins.Thus, your average Wingstop store, at scale, should be worth more than your average McDonald's store.Let's call it a per-store valuation of $4 million flat. On 6,000-plus locations globally, you're talking about a $24 billion company.That's more than 5x the current valuation.Needless to say, then, WING stock has huge long-term upside potential. Bottom Line on WING StockWING stock is the best restaurant stock to buy for patient, long-term investors. Valuation and technical friction may cause choppiness in WING stock here and now.Such friction won't last. Long term, WING stock is a winner, with multi-bagger return potential.So, if you're looking for a restaurant stock to buy and hold for the next five to 10 years, WING stock is your best option.Luke Lango is a Markets Analyst for InvestorPlace. He has been professionally analyzing stocks for several years, previously working at various hedge funds and currently running his own investment fund in San Diego. A Caltech graduate, Luke has consistently been rated one of the world's top stock pickers by various other analysts and platforms, and has developed a reputation for leveraging his technology background to identify growth stocks that deliver outstanding returns. Luke is also the founder of Fantastic, a social discovery company backed by an LA-based internet venture firm. As of this writing, Luke Lango did not hold a position in any of the aforementioned securities. More From InvestorPlace * Why Everyone Is Investing in 5G All WRONG * America's 1 Stock Picker Reveals His Next 1,000% Winner * Revolutionary Tech Behind 5G Rollout Is Being Pioneered By This 1 Company * Radical New Battery Could Dismantle Oil Markets The post Hyper-Growth Wingstop Stock Could Be the Next McDonald's appeared first on InvestorPlace.

  • Benzinga

    ROCE Insights For Wingstop

    Looking at Q2, Wingstop (NASDAQ: WING) earned $15.32 million, a 64.3% increase from the preceding quarter. Wingstop also posted a total of $66.11 million in sales, a 19.25% increase since Q1. In Q1, Wingstop earned $9.33 million and total sales reached $55.44 million.What Is ROCE? Changes in earnings and sales indicate shifts in Wingstop's Return on Capital Employed, a measure of yearly pre-tax profit relative to capital employed in a business. Generally, a higher ROCE suggests successful growth in a company and is a sign of higher earnings per share for shareholders in the future. In Q2, Wingstop posted an ROCE of 0.13%.View more earnings on WINGIt is important to keep in mind ROCE evaluates past performance and is not used as a predictive tool. It is a good measure of a company's recent performance, but several factors could affect earnings and sales in the near future.ROCE is an important metric for the comparison of similar companies. A relatively high ROCE shows Wingstop is potentially operating at a higher level of efficiency than other companies in its industry. If the company is generating high profits with its current level of capital, some of that money can be reinvested in more capital which will lead to higher returns and earnings per share growth. In Wingstop's case, the positive ROCE ratio will be something investors pay attention to before making long-term financial decisions.Q2 Earnings Wingstop reported Q2 earnings per share at $0.34/share against analyst predictions of $0.29/share.See more from Benzinga * Stocks That Hit 52-Week Highs On Thursday * Stocks That Hit 52-Week Highs On Wednesday * Earnings Scheduled For July 29, 2020(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.