What: El Pollo Loco (NASDAQ:LOCO) stock fell on Friday, following the company's third-quarter results. Shares declined as much as 10% during the trading day, but are down only 5% at the time of this writing.
So what: The stock's decline likely reflects a negative reaction to El Pollo Loco's decision to reduce its outlook for the full year, as well as the company's unimpressive comparable store sales growth of just 0.6%.
On a positive note, the quarter's results were arguably solid, with revenue and adjusted EPS of $88.9 million and $0.18, up from $86.6 million and $0.13 in the year-ago quarter.
Now what: El Pollo Loco has narrowed and lowered its expectations for full-year adjusted EPS to a range of $0.67 to $0.69, down from prior expectations of somewhere between $0.67 and $0.71.
The company also lowered its expectations for full-year same-store sales growth to 1.7%, down from 3%.
In the third-quarter results press release, management didn't provide any specific reasons for the underwhelming expectations for same-store sales growth, or for its lowered expectations for EPS. The company only said the update is "based upon current information."
El Pollo Loco CEO Steve Sather did note that the company's "new restaurant pipeline is strong and growing stronger, and we continue to be excited about the long runway of growth that we believe is ahead of us in both new and existing markets."
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