Wedbush: buy this restaurant stock ‘that will see cost deflation in 2022’

By:
on Mar 23, 2022
Listen
  • Wedbush Securities added Wingstop Inc to its list of "Best Ideas" on Wednesday.
  • Analyst Nick Setyan says the stock could climb to $165 or 45% up from here.
  • WING is well-positioned for both recessionary and expansionary environments.

Follow Invezz on Telegram, Twitter, and Google News for instant updates >

Better days are coming for Wingstop Inc (NASDAQ: WING) shareholders, says a Wedbush analyst who added the restaurant company to his list of “Best Ideas” on Wednesday.  

Are you looking for signals & alerts from pro-traders? Sign-up to Invezz Signals™ for FREE. Takes 2 mins.

Nick Setyan assigns a $165 price target to Wingstop

Copy link to section

Nick Setyan rates WING at “outperform” with a price target of $165 a share that represents a 45% upside from here. In a note this morning, he said:

We believe upside to 2022 SSS growth expectations exists and view WING as relatively well-positioned in both recessionary and expansionary environments due to its historical outperformance, its relative value positioning, and the uptick in the national ad fund this year.

In its latest reported quarter, Wingstop’s domestic same-store sales were up 7.5%, helping total revenue pop up 13.8% on a year-over-year basis.

Sell-off made Wingstop a great buying opportunity

Copy link to section

Wingstop has had a rough start to the year, with the stock down more than 30% YTD, which Setyan says makes it attractive on valuation. He added:

Wingstop is the only restaurant within our coverage universe that will see food cost deflation in 2022, which will allow for a number of options to sustain top line outperformance, while peers’ options may be limited.

Wingstop has a history of doing well in times when commodity prices go up as well as when they come down. The chain of nostalgic, aviation-themed restaurants recently debuted in Spain as part of its broader push into international markets.

Ad

Want easy-to-follow crypto, forex & stock trading signals? Make trading simple by copying our team of pro-traders. Consistent results. Sign-up today at Invezz Signals.

Learn more
USA Food & Beverage North America Stock Market World