Modern Fast Food Stocks Q2 Earnings: Wingstop (NASDAQ:WING) Best of the Bunch

Wrapping up Q2 earnings, we look at the numbers and key takeaways for the modern fast food stocks, including Wingstop (NASDAQ:WING) and its peers.

Modern fast food is a relatively newer category representing a middle ground between traditional fast food and sit-down restaurants. These establishments feature an expanded menu selection priced above traditional fast food options, often incorporating fresher and cleaner ingredients to serve customers prioritizing quality. These eateries are capitalizing on the perception that your drive-through burger and fries joint is detrimental to your health because of inferior ingredients.

The 6 modern fast food stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 1.5%.

Stocks, especially growth stocks with cash flows further into the future, had a good end of 2023. On the other hand, this year has seen more volatile stock market swings due to mixed inflation data. Luckily, modern fast food stocks have performed well with share prices up 10.2% on average since the latest earnings results.

Best Q2: Wingstop (NASDAQ:WING)

The passion project of two chicken wing aficionados in Texas, Wingstop (NASDAQ:WING) is a popular fast-food chain known for its flavorful and crispy chicken wings offered in a variety of sauces and seasonings.

Wingstop reported revenues of $155.7 million, up 45.3% year on year. This print exceeded analysts’ expectations by 7.3%. Overall, it was an exceptional quarter for the company with an impressive beat of analysts’ gross margin estimates and a decent beat of analysts’ earnings estimates.

"The second quarter marked another industry-leading quarter for Wingstop, further solidifying our category-of-one position. With same store sales growth of 28.7%, driven primarily by transactions, our AUVs now exceed $2.0 million, a target we set only two years ago when AUVs just crossed $1.5 million. Due to the strength and staying power of our multi-year strategies, we believe we have line of sight to a new AUV target of $3.0 million," said Michael Skipworth, President and Chief Executive Officer.

Wingstop pulled off the biggest analyst estimates beat and fastest revenue growth of the whole group. Unsurprisingly, the stock is up 2.4% since reporting and currently trades at $386.50.

Read why we think that Wingstop is one of the best modern fast food stocks, our full report is free.

Potbelly (NASDAQ:PBPB)

With a unique origin story where the company actually started as an antique shop, Potbelly (NASDAQ:PBPB) today is a chain known for its toasty sandwiches.

Potbelly reported revenues of $119.7 million, down 5.5% year on year, in line with analysts’ expectations. It was a very strong quarter for the company with an impressive beat of analysts’ gross margin estimates and a solid beat of analysts’ earnings estimates.

The market seems happy with the results as the stock is up 11.5% since reporting. It currently trades at $7.64.

Is now the time to buy Potbelly? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Noodles (NASDAQ:NDLS)

Offering pasta, mac and cheese, pad thai, and more, Noodles & Company (NASDAQ:NDLS) is a casual restaurant chain that serves all manner of noodles from around the world.

Noodles reported revenues of $127.4 million, up 1.8% year on year, falling short of analysts’ expectations by 2.6%. It was a weaker quarter for the company with full-year revenue guidance missing analysts’ expectations and a miss of analysts’ earnings estimates.

Noodles posted the weakest performance against analyst estimates and weakest full-year guidance update in the group. Interestingly, the stock is up 2.4% since the results and currently trades at $1.50.

Read our full analysis of Noodles’s results here.

Sweetgreen (NYSE:SG)

Founded in 2007 by three Georgetown University alum, Sweetgreen (NYSE:SG) is a casual quick service chain known for its healthy salads and bowls.

Sweetgreen reported revenues of $184.6 million, up 21.1% year on year, surpassing analysts’ expectations by 2.1%. Overall, it was a mixed quarter for the company with a decent beat of analysts’ gross margin estimates but a miss of analysts’ earnings estimates.

Sweetgreen scored the highest full-year guidance raise among its peers. The stock is up 21.8% since reporting and currently trades at $31.99.

Read our full, actionable report on Sweetgreen here, it’s free.

Shake Shack (NYSE:SHAK)

Started as a hot dog cart in New York City's Madison Square Park, Shake Shack (NYSE:SHAK) is a fast-food restaurant known for its burgers and milkshakes.

Shake Shack reported revenues of $316.5 million, up 16.4% year on year, in line with analysts’ expectations. More broadly, it was a very strong quarter for the company with an impressive beat of analysts’ gross margin estimates and a narrow beat of analysts’ earnings estimates .

The stock is up 15.6% since reporting and currently trades at $101.31.

Read our full, actionable report on Shake Shack here, it’s free.

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