Noodles & Company Faces Slow Traffic Recovery In Q2, Despite Value Pricing Initiatives, Analyst Says
Portfolio Pulse from Nabaparna Bhattacharya
Benchmark analyst Todd M. Brooks has reiterated a Buy rating on Noodles & Company (NDLS), but lowered the price target from $8 to $6. The analyst has observed only modest traffic recovery in Q2 2023, despite the company's value pricing initiatives. The analyst also decreased the Q2 2023 systemwide same-store sales (SSS) estimate to (3.1)% from the prior estimate of (0.3)%. Adjusted EPS and EBITDA estimates for the quarter were also lowered. However, the recent appointment of Michael Hynes as NDLS's new CFO was viewed positively.
July 05, 2023 | 6:14 pm
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NEGATIVE IMPACT
Noodles & Company's stock price may be negatively impacted in the short term due to the lowered price target and decreased earnings estimates. However, the appointment of a new CFO could bring positive changes.
The lowered price target and decreased earnings estimates indicate that the analyst has a less optimistic view of the company's performance in the short term, which could negatively impact the stock price. However, the appointment of a new CFO could bring about positive changes in the company's financial management, which could potentially offset some of the negative impact.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100