Wingstop (WING -0.70%) had a good day on Tuesday as the company's stock price jumped significantly higher. It was up 10.6% at about 12:05 p.m. ET and finished the day not far off that high, up 9.1% at the closing bell to $132 per share.
The takeout restaurant, which specializes in chicken wings, was one of Tuesday's market leaders -- as all three major indexes were down with the Dow Jones 170 points lower, the Nasdaq falling 86 points, and the S&P 500 off 15 points. Wingstop stock is down about 23% year to date.
The market really liked Wingstop on Tuesday -- and there may have been a few reasons for that. One is some favorable economic news dropped Tuesday in the form of the Institute for Supply Management's (ISM) Services Index. The ISM Services Index is a key indicator for Wingstop, among others, as it measures overall economic activity in the services industry.
The ISM Services Index was at 56.9% in August, up for the second straight month. The 56.9% was its highest level since April as it soundly topped analysts' expectations of 55.4% -- signaling a growing services economy.
Also, starting this month, Wingstop expanded its menu, coinciding with the start of the NFL and college football season, by offering its first chicken sandwich, available in 12 different flavors. Stacy Peterson, chief revenue and technology officer at Wingstop, called it an opportunity to bring in new customers and establish its brand as the "Flavor Experts."
Wingstop anticipates low single-digit same-store sales growth for fiscal 2022, maintaining its previous guidance. While economic uncertainty prevails, the rising ISM Services Index showing that the services economy is not contracting bodes well for Wingstop.
The company is hoping that the expanded menu and options, along with a recent decision to add Uber Eats as a delivery partner in addition to DoorDash, which had been its exclusive partner, will boost revenue.