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First Watch Q3 revenue slightly beats estimates on new restaurant openings

By Reuters News


Overview

  • U.S. daytime dining chain's Q3 revenue grew 10.7%, slightly beating analyst expectations

  • Adjusted EBITDA for Q3 beat analyst expectations

  • Net income rose to $4.8 mln from $3.0 mln a year ago


Outlook

  • Company expects fiscal 2026 same-restaurant sales growth of about 2.0%

  • Company sees fiscal 2026 total revenue growth of about 13.5%

  • Company forecasts fiscal 2026 adjusted EBITDA of about $136 mln


Result Drivers

  • NEW RESTAURANT OPENINGS - Co said opening 16 new system-wide restaurants contributed to revenue growth

  • MODEST SAME-RESTAURANT SALES - Co reported 1.0% same-restaurant sales growth, while same-restaurant traffic declined 1.9%

  • ADJUSTED EBITDA OUTLOOK - Co said Q3 Adjusted EBITDA growth exceeded internal expectations, prompting a raised full-year outlook


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 Revenue

Slight Beat*

$349.86 mln

$348.99 mln (10 Analysts)

Q3 EPS

$0.08

Q3 Net Income

$4.79 mln

Q3 Adjusted EBITDA

Beat

$39.75 mln

$33.45 mln (10 Analysts)

Q3 Adjusted EBITDA Margin

11.40%

Q3 EBITDA

$34.11 mln

*Applies to a deviation of less than 1%; not applicable for per-share numbers.


Analyst Coverage

  • The current average analyst rating on the shares is "strong buy" and the breakdown of recommendations is 10 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

  • The average consensus recommendation for the restaurants & bars peer group is "buy."

  • Wall Street's median 12-month price target for First Watch Restaurant Group, Inc. is $18.00, about 39% above its November 2 closing price of $12.95

  • The stock recently traded at 61 times the next 12-month earnings vs. a P/E of 60 three months ago


Reuters Recommended Reads

  • Nov 2 - Canada's Pizza Pizza Royalty Q3 same store sales fall on weak consumer spending

  • Nov 2 - Pizza Hut, KFC India operator's Q2 loss narrows sharply on strong same-store sales growth

  • Nov 3 - China's Yum China Q3 revenue rises on store expansion


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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