Texas Roadhouse, Inc. (TXRH) Surges on Higher Than Expected Earnings

Shares of Louisville, Kentucky, based Texas Roadhouse, Inc. (TXRH) rose on Tuesday, against the backrop of a down day in stocks across the board. Texas Roadhouse's stock was up 12.72%, rising $4.70 per share, to close at $41.65, on volume of 5,272,514 shares. The company reported higher than expected earnings for the fourth quarter, and a solid increase in same store sales compared to the same period a year earlier.

Founded in 1993, Texas Roadhouse, Inc. is a full-service, casual dining restaurant chain, offering seasoned and aged steaks hand-cut daily on the premises and cooked to order over open gas-fired grills.
It operates 485 restaurants in 49 states and 4 foreign countries under the Texas Roadhouse and Aspen Creek names. The company also offers ribs, fish, seafood, chicken, pork chops, pulled pork and vegetable plates, an assortment of hamburgers, salads and sandwiches. It is noteworthy for offering guests a free unlimited supply of in-shell peanuts and made-from-scratch yeast rolls. The company's stock trades on the NASDAQ exchange.

On Monday evening, Texas Roadhouse announced results for its fourth quarter and year end, both ended December 29, 2015. The company had earnings of $0.32 per share in the fourth quarter, representing a 23% increase over the $0.26 reported a year earlier, and beating analysts expectations by $0.02. For the year, earnings were reported at $1.37 per share, up 11% above the 2014 total of $1.23 per share.

Revenues were also up for both the fourth quarter and for the entire year. Fourth quarter revenues reached $454.4 million, up 12% over the fourth quarter 2014 total of $404.4 million. Revenues for all of 2015 came in at $1.807 billion, representing a 14% increase over the $1.582 million for all of 2014.

Meanwhile, for the fourth quarter, same-store sales increased 4.5% at company stores, and by 4.0% at franchise restaurants. For the entire year, comparable restaurant sales grew by 7.2% at company restaurants, and by 6.5% at franchise restaurants. Seven new restaurants were opened in the fourth quarter, and a total of 29 for the entire year.

Last Friday, Texas Roadhouse's Board of Directors authorized a quarterly cash dividend of $0.19 per share, payable on April 1 to shareholders of record at the close of business on March 16. The dividend represents an increase of 12% over the $0.17 per share dividend paid during each quarter of 2015.

"We ended the year on a strong note, with double digit revenue and diluted earnings per share growth for both the fourth quarter and the full year. This represents our 24th consecutive quarter of positive comparable restaurant sales growth," noted Kent Taylor, Chief Executive Officer of Texas Roadhouse, Inc. "We have assembled a substantial pipeline of new locations and are on track to open approximately 30 company restaurants this year. Our top-line momentum has continued into 2016 and we are pleased to have seen continued traffic growth during the first seven weeks of the year."

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Published on Feb 24, 2016
By Kevin Mercadante

Copyrighted 2020. Content published with author's permission.

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