On May 1st Wingstop Inc. (WING) reported on Q1 ending March 30, 2024. Results exceeded consensus estimates on revenue by 7.2 percent and on earnings by 27 percent. For the period, total revenue including royalties and advertising fees attained $145,789 million. Net income was $28.8 million with a diluted EPS of $0.98. For Q1 FY 2023, total revenue was $108.7 million with net income of $15.7 million and a diluted EPS of $0.52.
Comparing Q1 FY 2024 with Q1 2023, revenue was up 34.1 percent and operating margin was 31.6 percent compared to 26.4 percent.
For Q1 growth in same-store sales attained 21.6 percent and digital orders represented 68.3 percent of systemwide sales. At the end of Q1 Wingstop operated 2,279 locations of which 98 percent were franchised including 305 international units. The chain was extended by 65 locations during Q1.
In commenting on Q1, Michael Skipworth CEO stated, “Our fiscal first quarter 2024 showcased the momentum behind the Wingstop brand and the continued strength of our strategies, delivering same-store sales growth driven almost entirely by transaction growth,” He added, “Our domestic average unit volume exceeded $1.9 million, further strengthening returns for our brand partners and is strengthening our development pipeline, which gives us confidence in our ability to scale Wingstop into a Top-10 Global Restaurant Brand.”
Guidance for FY 2024 included low double-digit growth in domestic same-store sales.
The company posted total assets of $412.3 million of which $167.8 million comprised intangibles including goodwill, trademarks and ‘relationships’. The company carries long-term debt of $730.8 million.
Wingstop has a market capitalization of $11,410 million and has traded over 52-weeks in a range of $150.08 to $396.00 with a 50-day moving average of $368.85. The company generated a twelve-month trailing operating margin of 29.3 percent and a profit margin of 16.8 percent. The return on assets attained 19.1 percent. Shareholding is held almost entirely by institutions, but on April 15th, 6.9 percent of the float was short.
USDA posted a wholesale price of $2.31 per pound for cut wings for the week ending April 19th. According to the April 24nd USDA Cold Storage Report, there was a 19.6 percent decrease in inventory of wings on March 31st 2024, compared to the corresponding date in 2023 with a stock of 51.8 million pounds. During March 2024, inventory fell 1.7 percent reflecting stable demand despite sports events associated with consumption of chicken wings.