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1. Company Snapshot

1.a. Company Description

Brinker International, Inc., together with its subsidiaries, engages in the ownership, development, operation, and franchising of casual dining restaurants in the United States and internationally.The company operates in two segments, Chili's and Maggiano's.As of June 30, 2021, it owned, operated, or franchised 1,648 restaurants comprising 1,594 restaurants under the Chili's Grill & Bar name and 54 restaurants under the Maggiano's Little Italy brand name.


The company was founded in 1975 and is headquartered in Dallas, Texas.

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1.b. Last Insights on EAT

Brinker International's recent performance was driven by strong Q2 earnings, with revenue beating estimates at $1.45B, up 7% YoY, and EPS of $2.87, surpassing the Zacks Consensus Estimate of $2.53. Chili's same-store sales growth of 8.6% and operating margins rising 270 bps to 16.2% fueled the outperformance. The company raised its FY'26 guidance, targeting $5.76-5.83B revenue and $10.45-10.85 EPS. Additionally, Brinker International's low leverage of 2.1x EBITDA and robust free cash flow position it for continued capital returns. Several institutional investors, including Balyasny Asset Management and Arrowstreet Capital, have increased their stakes in the company.

1.c. Company Highlights

2. Brinker International's Q2 2026 Earnings: A Strong Performance

Brinker International, Inc. reported total revenues of $1.45 billion in Q2, an increase of 7% over the prior year. Consolidated comp sales were positive 7.5%, and adjusted diluted EPS was $2.87, up from $2.80 last year, beating analysts' estimates of $2.53. The company's strong financial performance was driven by Chili's top-line sales growth, which was fueled by price (4.4%), positive traffic (2.7%), and positive mix (1.5%).

Publication Date: Feb -08

📋 Highlights
  • Chili's Same-Store Sales Growth:: Achieved 8.6% growth in Q2, outpacing the casual dining industry by 680 basis points, with a 19-quarter streak and 62% four-year cumulative comp.
  • Revenue and EPS Increase:: Total revenue rose 7% to $1.45 billion, with adjusted diluted EPS up to $2.87 (vs. $2.80 prior year) and consolidated comp sales at +7.5%.
  • Menu Innovation Success:: Skillet queso sales grew 20%, nachos revenue surged 170%, and bacon cheeseburgers saw 30-43% sales increases post-upgrade.
  • 2026 Guidance Raised:: Revenue forecast set at $5.76-$5.83 billion, adjusted EPS at $10.45-$10.85, with chili's driving growth via pricing (4.4% price lift) and traffic (2.7% increase).
  • Maggiano's Turnaround Progress:: Menu re-introductions and larger portions improved value scores, though service and culture challenges remain pending further operational fixes.

Segment Performance

Chili's same-store sales growth was 8.6%, outpacing the casual dining industry by 680 basis points, marking the 19th consecutive quarter of same-store sales growth. The company has made significant progress in Q2, including the reintroduction of popular menu items, such as skillet queso, which saw a 20% increase in sales. Maggiano's, a subsidiary of Brinker International, is also making progress on its turnaround, with improved value scores and larger portions.

Guidance and Outlook

The company raised its fiscal 2026 guidance, which includes annual revenues in the range of $5.76 billion to $5.83 billion, adjusted diluted EPS in the range of $10.45 to $10.85. Brinker International expects mid single-digit comps for the back half of the year, with a slight moderation in mix due to lapping big triple dipper numbers. Analysts estimate next year's revenue growth at 5.4%.

Valuation

Brinker International's current P/E Ratio is 16.63, and its P/S Ratio is 1.29. The company's ROE is 134.24%, and its ROIC is 22.14%. These valuation metrics suggest that the market has high expectations for the company's future performance. The strong EPS beat and raised guidance indicate that Brinker International is on track to meet or exceed these expectations.

3. NewsRoom

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Are Retail-Wholesale Stocks Lagging Brinker International (EAT) This Year?

Feb -16

Source: zacks.com

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Brinker International: Revenue Growth, Margin Stability, And Buybacks Reinforce Buy Case

Feb -14

Source: seekingalpha.com

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When Love Drives Spending: 5 Stock Picks for Valentine's Day

Feb -13

Source: zacks.com

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3 Restaurant Stocks to Buy Despite Ongoing Industry Pressures

Feb -13

Source: zacks.com

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Brinker International: Crisp Results, Traffic Gains, Still Room To Turn Up The Heat

Feb -12

Source: seekingalpha.com

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Chili's® Turns Its Margarita of The Month Fandom into an Official Club

Feb -11

Source: prnewswire.com

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Is Brinker Stock a Buy or Sell After Its CFO Sold 5,000 Shares?

Feb -07

Source: fool.com

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Aaron White Sells 7,000 Shares of Brinker International (NYSE:EAT) Stock

Feb -07

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.85%)

6. Segments

Chili's

Expected Growth: 2.8%

Chili's 2.8% growth driven by effective menu engineering, successful marketing campaigns, and strategic pricing. Additionally, investments in digital transformation, including online ordering and mobile payments, have enhanced the customer experience. Furthermore, the brand's focus on off-premise sales and third-party delivery partnerships has expanded its reach and convenience.

Maggiano's

Expected Growth: 3.2%

Maggiano's 3.2% growth driven by increased off-premise sales, menu innovation, and effective marketing strategies. Additionally, focus on digital transformation, including online ordering and delivery, has contributed to the growth. Furthermore, the brand's upscale casual dining experience and loyalty program have helped to attract and retain customers, resulting in increased sales and revenue.

7. Detailed Products

Chili's

Casual dining restaurant chain serving American-style Tex-Mex cuisine

Maggiano's Little Italy

Upscale casual dining restaurant chain serving Italian-American cuisine

On The Border Mexican Grill & Cantina

Casual dining restaurant chain serving Mexican-inspired cuisine

It's Just Wings

Virtual wing brand offering a variety of wing flavors and sauces

8. Brinker International, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Brinker International, Inc. faces moderate threat from substitutes as consumers have various options for dining out, including fast-food chains, casual dining, and fine dining restaurants.

Bargaining Power Of Customers

Brinker International, Inc. has a high bargaining power of customers due to the presence of many alternatives, making it easy for customers to switch to competitors.

Bargaining Power Of Suppliers

Brinker International, Inc. has a low bargaining power of suppliers due to its large scale of operations, which gives it negotiating power over suppliers.

Threat Of New Entrants

Brinker International, Inc. faces a low threat of new entrants due to the high barriers to entry, including high startup costs and regulatory hurdles.

Intensity Of Rivalry

Brinker International, Inc. operates in a highly competitive industry, with many established players, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 104.94%
Debt Cost 3.95%
Equity Weight -4.94%
Equity Cost 16.11%
WACC 3.34%
Leverage -2122.38%

11. Quality Control: Brinker International, Inc. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Darden

A-Score: 6.1/10

Value: 4.0

Growth: 6.0

Quality: 5.4

Yield: 6.0

Momentum: 6.0

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
Wendy's

A-Score: 5.6/10

Value: 6.3

Growth: 5.9

Quality: 4.8

Yield: 9.0

Momentum: 0.0

Volatility: 7.3

1-Year Total Return ->

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Texas Roadhouse

A-Score: 5.4/10

Value: 2.6

Growth: 8.2

Quality: 5.5

Yield: 4.0

Momentum: 4.0

Volatility: 8.3

1-Year Total Return ->

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Domino's Pizza

A-Score: 5.4/10

Value: 4.2

Growth: 6.4

Quality: 6.0

Yield: 3.0

Momentum: 4.0

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
Brinker

A-Score: 4.7/10

Value: 4.7

Growth: 8.0

Quality: 5.4

Yield: 0.0

Momentum: 6.0

Volatility: 4.0

1-Year Total Return ->

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Stock-Card
Wingstop

A-Score: 4.4/10

Value: 2.5

Growth: 9.4

Quality: 6.9

Yield: 1.0

Momentum: 3.0

Volatility: 3.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

161.07$

Current Price

161.07$

Potential

-0.00%

Expected Cash-Flows