Wendy's seeks growth through breakfast sales, aiming for an 11% upside potential

From NASDAQ.: 2024-08-05 07:00:00

Wendy’s stock (NASDAQ: WEN) is underperforming the consumer discretionary sector in 2024, with a total return of -10%. The Consumer Discretionary Select Sector SPDR Fund (NYSEARCA: XLY) has a return of -1%. Wendy’s has two main operating segments, with U.S. locations making up the majority of its revenue.

In Q2 2024, Wendy’s reported slightly lower adjusted earnings per share (EPS) compared to estimates but revenue was up 1.6% from a year ago. The company reaffirmed its full-year adjusted EPS guidance, slightly above expectations. Wendy’s saw global same-store sales growth of 0.8%.

Wendy’s CEO Kirk Tanner emphasizes the importance of the breakfast business for future profitability. Currently, Wendy’s has a small market share in breakfast, but the CEO aims to double breakfast sales per store over the next two years. Investors should track Wendy’s progress in growing its breakfast business.

Recent success in Wendy’s breakfast offerings and the popularity of the Biggie Bag value meal have boosted visits to the restaurant. Analysts have updated their price targets for Wendy’s stock, with an average price target of $18.78, implying an 11% upside potential.



Read more at NASDAQ.:: Wendy’s Faces Challenges: Will Breakfast Sales Boost Stock?