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1. Company Snapshot

1.a. Company Description

Red Robin Gourmet Burgers, Inc., together with its subsidiaries, develops, operates, and franchises full-service and casual-dining restaurants.The company's restaurants primarily offer burgers and shareable pizzas; various appetizers, salads, soups, sandwiches, seafood, and other entrees; and desserts, wings, milkshakes, alcoholic and non-alcoholic specialty drinks, cocktails, wine, and beers.As of December 26, 2021, it operated approximately 531 Red Robin restaurants, including 430 were company-owned and 101 were operated by franchisees in the United States and one Canadian province.


Red Robin Gourmet Burgers, Inc.was founded in 1969 and is based in Greenwood Village, Colorado.

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1.b. Last Insights on RRGB

Red Robin Gourmet Burgers, Inc.'s recent performance was negatively driven by a challenging macroeconomic environment, leading to a Q3 earnings miss. The company reported a quarterly loss of $1.13 per share, exceeding the Zacks Consensus Estimate of a loss of $0.87. Despite beating revenue estimates, the weak earnings performance was a major concern. Additionally, the company's relaunched loyalty program showed growth, but it was not enough to offset the macroeconomic headwinds.

1.c. Company Highlights

2. Red Robin's Turnaround Efforts Show Promise

Red Robin Gourmet Burgers, Inc.'s financial performance in the third quarter of 2025 was marked by total revenues of $265.1 million, a decline from $274.6 million in the same period last year. However, comparable restaurant revenue decline of 1.2% was better than expected. Restaurant-level operating profit as a percentage of restaurant revenue improved to 9.9%, an increase of 90 basis points compared to the third quarter of 2024. The company's EPS was -$0.7, beating estimates of -$0.78. The improvement in labor efficiency and off-premise business growth were notable highlights, with off-premise sales representing approximately 25% of total sales.

Publication Date: Nov -18

📋 Highlights
  • Revenue Decline and Improvement: Q3 total revenues were $265.1M (vs $274.6M in Q3 2024), with comp revenue down 1.2% but exceeding expectations.
  • Off-Premise Growth: Off-premise sales accounted for 25% of total revenue, driving 2.9% traffic growth in Q3.
  • Operating Margin Expansion: Restaurant-level operating profit hit 9.9% (up 90 bps YoY) amid labor efficiency gains without sacrificing guest satisfaction.
  • Big Yummm Initiative Impact: The promotion contributed 8% of total sales, delivering expected traffic, trial, and sales improvements.
  • 2025 Guidance: Maintaining $1.2B revenue target, with restaurant-level profit of ≥12.5% and adjusted EBITDA ≥$65M, despite Q4 comp guidance down 3%.

Operational Efficiency Gains

The company's operators have successfully raised the bar on performance, delivering labor results that beat internal expectations while maintaining guest satisfaction scores. This achievement demonstrates that efficiency and hospitality are not mutually exclusive. The off-premise business, driven largely by a significantly expanded approach to catering, delivered traffic growth of 2.9%. The drive traffic initiative is focused on creating sustainable traffic growth through improvements across relevant consumer touchpoints.

Guidance and Outlook

Red Robin's guidance for 2025 remains unchanged, with total revenue expected to be approximately $1.2 billion, and restaurant-level operating profit of at least 12.5%. The company is optimistic that traffic trends will regain traction as marketing spend levels increase in the remainder of the year. Analysts estimate next year's revenue growth at -2.7%, indicating a continued challenging environment.

Valuation Metrics

Red Robin's current valuation metrics are noteworthy, with a P/S Ratio of 0.06 and an EV/EBITDA of 21.86. The company's ROE is 71.93%, although this is likely influenced by the negative equity due to accumulated losses. The Net Debt / EBITDA ratio is 19.1, indicating a high level of debt relative to EBITDA. These metrics suggest that the market is pricing in significant challenges for the company, and a turnaround will be required to justify the current valuation.

3. NewsRoom

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Red Robin Stock Down 33% in 6 Months: Time to Buy the Dip?

Dec -03

Source: zacks.com

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Red Robin Gourmet Burgers, Inc. $RRGB Shares Bought by Bandera Partners LLC

Nov -25

Source: defenseworld.net

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Red Robin (RRGB) Reports Q3 Loss, Beats Revenue Estimates

Nov -10

Source: zacks.com

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Red Robin Gourmet Burgers, Inc. (RRGB) Q3 2025 Earnings Call Transcript

Nov -10

Source: seekingalpha.com

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Red Robin Announces At-The-Market Equity Offering Program

Nov -10

Source: prnewswire.com

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Red Robin Gourmet Burgers, Inc. Reports Results for the Fiscal Third Quarter Ended October 5, 2025

Nov -10

Source: prnewswire.com

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Red Robin Gourmet Burgers, Inc. Announces Leadership Transitions

Nov -05

Source: prnewswire.com

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3 Restaurant Stocks to Watch Despite Industry Challenges

Nov -04

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.98%)

6. Segments

Restaurant

Expected Growth: 3%

Red Robin's 3% growth is driven by increasing same-store sales, successful menu innovation, and effective marketing strategies. Additionally, the company's focus on off-premise dining, digital transformation, and remodels of existing locations contribute to its growth. Furthermore, Red Robin's efforts to improve operational efficiency and reduce costs also support its growth momentum.

Franchise

Expected Growth: 1.5%

Red Robin's franchise growth is driven by increasing demand for casual dining, expansion into new markets, and strategic menu innovation. The brand's focus on gourmet burgers and family-friendly atmosphere resonates with consumers, leading to higher sales and profitability. Additionally, the company's efforts to enhance the customer experience through technology and remodels contribute to the 1.5% growth rate.

Gift Card

Expected Growth: 4%

Increased adoption of digital gift cards, strategic partnerships with popular food delivery services, expansion of online ordering capabilities, and targeted marketing campaigns towards millennials and Gen Z consumers drive the 4% growth of Gift Cards from Red Robin Gourmet Burgers, Inc.

Other

Expected Growth: 1%

Red Robin's 'Other' segment growth is driven by increasing demand for off-premise sales, catering, and delivery services. The company's investments in digital transformation, including online ordering and mobile apps, have enhanced customer convenience and accessibility. Additionally, strategic partnerships with third-party delivery providers have expanded Red Robin's reach and contributed to the segment's growth.

7. Detailed Products

Gourmet Burgers

Red Robin's signature gourmet burgers made with fresh, never frozen beef, topped with a variety of ingredients and sauces.

Sandwiches

A variety of sandwiches including chicken, turkey, and veggie options, served on a toasted brioche bun.

Salads

Fresh, made-to-order salads with a variety of toppings and dressings, including gluten-free options.

Entrees

A selection of entrees including seafood, steak, and pasta dishes, made with fresh ingredients and flavorful sauces.

Sides

A variety of sides including Bottomless Steak Fries, sweet potato fries, and onion rings.

Desserts

A selection of decadent desserts including milkshakes, sundaes, and chocolate cake.

Beverages

A variety of soft drinks, iced tea, and coffee, as well as a selection of craft beers and wine.

8. Red Robin Gourmet Burgers, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Red Robin's menu items are moderately differentiated, and customers have some flexibility to switch to other casual dining restaurants or prepare meals at home.

Bargaining Power Of Customers

Red Robin's customers have a high bargaining power due to the presence of many casual dining restaurants and the ease of switching to competitors.

Bargaining Power Of Suppliers

Red Robin has a diverse supplier base, and the company's large scale of operations gives it bargaining power over its suppliers.

Threat Of New Entrants

While there are some barriers to entry in the casual dining industry, new entrants can still pose a threat to Red Robin's market share.

Intensity Of Rivalry

The casual dining industry is highly competitive, with many established players competing for market share, which increases the 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 109.88%
Debt Cost 4.23%
Equity Weight -9.88%
Equity Cost 17.86%
WACC 2.88%
Leverage -1112.18%

11. Quality Control: Red Robin Gourmet Burgers, 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

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Potbelly

A-Score: 4.1/10

Value: 2.4

Growth: 6.0

Quality: 3.5

Yield: 0.0

Momentum: 9.5

Volatility: 3.0

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Red Robin

A-Score: 3.6/10

Value: 8.2

Growth: 1.4

Quality: 3.6

Yield: 0.0

Momentum: 7.5

Volatility: 1.0

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A-Score: 3.3/10

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Growth: 5.2

Quality: 2.5

Yield: 0.0

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A-Score: 2.7/10

Value: 3.4

Growth: 6.0

Quality: 2.7

Yield: 0.0

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Volatility: 2.3

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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

3.98$

Current Price

3.98$

Potential

-0.00%

Expected Cash-Flows