These rebounding restaurants still offer gains

Article Excerpt

With COVID-19, both Texas Roadhouse and Chipotle dropped along with the market. But each has used a savvy strategy to rebound and climb to an all-time high. We think both companies are well-positioned to capitalize on their popular food offerings to attract more dine-in, pick-up and takeout customers. We see both stocks as buys. TEXAS ROADHOUSE $73.88 (Nasdaq symbol TXRH; TSINetwork Rating: Extra Risk) (www.texasroadhouse.com; Shares o/s: 69.4 million; Market cap: $5.2 billion; No dividends paid) is a full-service, casual-dining chain with 610 locations spread across 49 U.S. states and 10 foreign countries. Its restaurants operate under two banners—Texas Roadhouse (563 locations) and sports restaurants Bubba’s 33 (25). Most are company-owned restaurants. In the quarter ended June 30, 2020, sales fell 30.9%, to $476.4 million from $689.8 million a year earlier. In the wake of the coronavirus, same-store sales fell 32.8% for company-owned restaurants and 32.1% for U.S. franchise locations. Texas Roadhouse’s dining rooms only began reopening in May. The company lost $33.5…

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