I recently went with a friend to a very busy, very loud Buffalo Wild Wings (NASDAQ:BWLD) restaurant to watch a few NFL games. This particular location, in Spokane, Wash., just opened earlier in the year, and two more opened in the area the previous year. In fact, the company had yet another great year for business growth, with 60 more locations at the end of September than it had at the start of 2015. That brought the total number of locations around the world to 1,131, not including an additional 11 Pizza Rev and R Taco locations. As part of its profit growth plan, the company continues transitioning franchised restaurants to ones that are company-owned and -operated. In the nine months ended at the end of September, the company acquired 54 locations from franchisees. There were 573 company-owned restaurants at the end of September and 569 franchised ones.

In short, business appears to be booming. With such robust restaurant opening numbers in 2015, what kind of returns did investors of Buffalo Wild Wings notch for the year? And what kind of growth could investors expect for 2016? Let's take a look.

Growing business, flat stock
Despite the flurry of new locations, Buffalo Wild Wings stock hasn't experienced the same type of expansion. From January through September, shares rose by as much as 13%. Since then, however, prices have come back down below where they were to start 2015. As of this writing, the stock is trading at about an 8.5% year-to-date loss.

It all has to do with misses in net profitability, especially in third-quarter earnings results. Here's a look at the EPS numbers for the year:

Quarter

Analyst Expectations

Actual Results

Year-Over-Year Growth (Loss)

Q1 2015

$1.63

$1.52

1.7%

Q2 2015

$1.26

$1.12

(9.9%)

Q3 2015

$1.29

$1.00

(12.2%)

Source: Yahoo! Finance.

In addition to missing earnings estimates, the company has also experienced shrinking profitability compared with the previous year. This drop comes despite double-digit yer-over-year growth in total revenue, and it's being caused by increased food and labor costs (overall expenses rose almost 22% year-over year, food costs rose 25% year-over-year, and labor rose 22% year-over-year), as well as expenses incurred from the transition of those 54 restaurants from franchisees to ones that are company-owned and -operated. These costs were slightly offset by positive same-store sales growth for company-owned restaurants of 7% in the first quarter, 4.2% in the second quarter, and 3.9% in the third quarter.

Despite the disappointing run, the company still expects to turn in a solid fourth quarter, and analysts expect a year-over-year increase of about 39%. If that expectation is met, that mark would increase total 2015 profit about 4% over 2014.

2016 growth expectations
CEO Sally Smith reiterated on Oct. 28 that the company still expects 2016 net earnings growth to exceed 20%. The strategy includes opening 50 new company-owned locations (8%) growth, 30 new domestic franchise-operated locations, and 15 new international franchise-operated locations. Smith also said the small R Taco and Pizza Rev chains will explore expansion opportunities in the coming year.

Here is a look at overall expectations for 2016 and beyond:

Metric

Analyst Expectations

Revenue growth, Q1 2016

23.1%

Full-year 2016 revenue growth

19.6%

Earnings growth, Q1 2016

19.7%

Full-year 2016 earnings growth

26.1%

Next five years' earnings growth average

17.8%

Source: Yahoo! Finance.

A lot is riding on these expectations. Even after the drop in share prices, the forward price-to-earnings ratio based on 2016 profit estimates is over 31. Any continued earnings misses could result in stock performance similar to this past year.

For me, Buffalo Wild Wings stock is a little rich. I don't think single-digit percentage restaurant opening growth will translate into double-digit profit growth in the coming year. Labor and food costs are not expected to come back down, and there are still those new restaurant opening costs, so let's project this past year's profit margins (5.3%) onto the coming year's revenue growth expectation (19.6%). That puts 2016's earnings growth at about 13.5%, by my calculation.

With forward valuations still assuming high growth, I believe there is far too much room to miss estimates. However, the company has great-looking financials, as revenue should continue to increase with new restaurant openings, and total debt is very low, as indicated by a debt-to-equity ratio of only 0.18. Over the long term, the company also has the ability to continue to grow its brands with the Buffalo Wild Wings name, as well as with the still very limited R Taco and Pizza Rev names.

So despite some troubling numbers, as I observe from my booth the dozens of football fans crammed around TV's, stuffing themselves with chicken wings and beer, it certainly seems that Buffalo Wild Wings' future is bright.

Nicholas Rossolillo has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Buffalo Wild Wings. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.