Shares of Wingstop Inc (NASDAQ:WING) were soaring today as the fast-casual chicken chain turned in a strong third-quarter earnings report. As of 12:09 p.m. EDT, the stock was up 16.7%.
In a difficult environment for restaurants, Wingstop posted domestic same-store sales growth of 4.1% and beat estimates on the top and bottom lines.
Overall revenue increased 19.3% to $26 million, edging out estimates at $25.1 million, while adjusted earnings per share rose from $0.13 a share to $0.17, topping expectations by a penny. The same-store sales growth was particularly impressive; industrywide comparable sales fell 4% as the industry still appears to be in the midst of the so-called "restaurant recession." Wingstop, which relies on a franchise model, opened 32 new restaurants in the quarter and now has 1,088 locations globally.
CEO Charlie Morrison commented, "We continue to drive best-in-class results, and our third quarter demonstrates that we are working on the right strategic priorities for our business." Morrison also credited a recent advertising campaign for driving comparable sales growth.
Looking ahead, management affirmed its full-year guidance of low-single-digit same-store sales growth, systemwide unit growth of 13% to 15%, and adjusted earnings per share (EPS) of $0.74 to $0.75, up from $0.58 a year ago. Shares touched an all-time high on the report as the company is effectively executing its growth plan. While oversaturation in the restaurant industry could eventually cool off the company's growth, its franchise model gives it some protection. It's certainly not a surprise to see shares pop after a quarter like this.