Texas Roadhouse’s diverse restaurant brands provide a broad appeal to different customer segments. This has facilitated the company’s successful expansion of its digital capabilities, including mobile ordering and delivery services. This has contributed to a 23.5% revenue gain in the most recent quarter.
The firm also has a strong track record of increasing dividends, with a recent 11.5% increase in the quarterly payout. These factors, combined with its consistent financial performance and expansion plans, make it an attractive investment opportunity.
TEXAS ROADHOUSE (Nasdaq symbol TXRH; texasroadhouse.com) is a full-service, casual-dining restaurant chain with 772 locations spread across 49 U.S. states and 10 foreign countries.
Each of those restaurants operates under one of three banners—Texas Roadhouse (713 locations), sports restaurant Bubba’s 33 (48), and Jaggers (11).
Founded in 1993, the Texas Roadhouse chain offers customers moderately priced, full-service dining. It specializes in hand cut steaks cooked over an open grill. Ribs, seafood, chicken, pork chops, pulled pork and vegetable plates are also on the menu, along with hamburgers, salads and sandwiches.
Texas Roadhouse also gives its guests a free unlimited supply of in-shell roasted peanuts and fresh-baked dinner rolls.
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Bubba’s 33 is a family-friendly sports restaurant offering an assortment of wings, sandwiches, pizza and burgers. That includes its signature 33% bacon-grind patty. In addition, the chain offers an extensive selection of draft beer.
Jaggers is a new fast-food concept featuring hamburgers, chicken, milkshakes and salads made from scratch.
In the quarter ended December 31, 2024, overall sales jumped 23.5%, to $1.44 billion from $1.16 billion a year earlier. Same-store sales rose 7.7% for company-owned restaurants and 6.3% for U.S. franchise locations. Some nine company restaurants and five franchise restaurants were opened in the quarter.
Texas Roadhouse made $115.8 million, or $1.73 a share. That was up 59.9% from $72.4 million, or $1.08.
Texas Roadhouse: Digital adaptations keep operations and popularity expanding
During the pandemic, the company successfully expanded its takeout, pick-up and delivery business. Its own mobile ordering app has also encouraged repeat business. Not only that, new delivery channels and digital capabilities position the company—with its winning formula of moderately priced but high-quality food—to further expand as the economy improves.
Texas Roadhouse is raising its quarterly dividend by 11.5% with the April 2025 payment, to $0.68 from $0.61. The stock now yields 1.6%.
Recommendation in Power Growth Investor: Texas Roadhouse Inc. is a buy.
