Company Overview - BJ's Restaurants, Inc. is a national casual dining brand founded in 1978, operating over 200 restaurants across 31 states [2] - The company is known for its chef-crafted menu, which includes signature deep-dish pizzas, slow-roasted entrees, wings, and the famous Pizookie® dessert [2] - BJ's has been recognized for its craft brewing, winning the 2025 Vibe Vista Award for Best Beer Program and the 2024 Best Overall Beverage Program [2] Upcoming Financial Results - BJ's Restaurants will release its fourth quarter and fiscal year 2025 results after the market closes on February 25, 2026 [1] - An investor conference call is scheduled for 2:00 p.m. (Pacific) on the same day, which will be broadcast live over the Internet [1] - The presentation will be available for 30 days following the call [1]

Industry Overview - High prices are challenging consumers, leading to cautious spending, yet the retail sector, particularly restaurants, has shown resilience amid inflationary pressures [1][5] - Restaurant sales in the U.S. reached $735.9 billion in November, marking a 0.6% increase from the previous month and a 3.3% year-over-year growth [4] Investment Opportunities - The current environment suggests investing in restaurant stocks with a strong online presence, specifically Aramark (ARMK), Brinker International, Inc. (EAT), and BJ's Restaurants, Inc. (BJRI) [2] - These selected stocks have experienced positive earnings estimate revisions in the past 60 days and are expected to deliver solid returns, with Zacks Ranks of 1 (Strong Buy) or 2 (Buy) [3] Company Insights Aramark (ARMK) - Aramark benefits from steady restaurant sales and provides food services across various sectors including healthcare and education [10] - The expected earnings growth rate for Aramark is 16.9%, with a Zacks Consensus Estimate improvement of 0.5% over the past 60 days, currently holding a Zacks Rank 2 [12] Brinker International, Inc. (EAT) - Brinker International operates restaurants under the Chili's and Maggiano's brands, with a strong presence in casual dining [13] - The expected earnings growth rate for Brinker is 18.7%, with a Zacks Consensus Estimate improvement of 3.4% over the past 60 days, currently holding a Zacks Rank 1 [14] BJ's Restaurants, Inc. (BJRI) - BJ's Restaurants operates a chain of high-end casual dining establishments, offering a diverse menu for various dining occasions [15] - The expected earnings growth rate for BJ's is 49.7%, with a Zacks Consensus Estimate improvement of 0.5% over the past 60 days, currently holding a Zacks Rank 2 [15]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher," contrasting with traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investing can be risky as stocks may lose momentum when their valuations exceed future growth potential [1] - A safer approach involves investing in bargain stocks that exhibit recent price momentum, identified through the Zacks Momentum Style Score [2] Group 2: BJ's Restaurants (BJRI) Analysis - BJRI has shown a four-week price change of 7.1%, indicating growing investor interest [3] - Over the past 12 weeks, BJRI's stock gained 21.8%, demonstrating its ability to deliver positive returns over a longer timeframe [4] - BJRI has a Momentum Score of B, suggesting it is an opportune time to invest in the stock [5] - The stock has a Zacks Rank 2 (Buy) due to upward revisions in earnings estimates, which attract more investors [6] - BJRI is trading at a Price-to-Sales ratio of 0.64, indicating it is reasonably valued at 64 cents for each dollar of sales [6] Group 3: Additional Investment Opportunities - Besides BJRI, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [7] - Zacks offers over 45 Premium Screens tailored to different investing styles, aiding in stock selection [8]

Core Insights - Christopher Pinsak has been promoted to chief operating officer of BJ's Restaurants, having previously served as executive vice president and chief restaurant operations officer since September 2024 [1] - Pinsak has a long history with the company, joining in 2004 and holding various positions, including senior regional vice president and director of operations for Wood Ranch BBQ & Grill [2] - His appointment follows the recent naming of Lyle Tick as CEO, and the company has implemented a strategic plan focusing on core menu offerings, leveraging its Pizookie platform, simplifying operations, and enhancing the dining environment [3] Company Performance - BJ's Restaurants reported its fifth consecutive quarter of sales and traffic growth, along with its fourth consecutive quarter of profit expansion as of November [3]

Weather Impact on Retail - A winter storm is expected to affect a significant portion of the U.S., potentially impacting consumer behavior and retail sales [2][3] - Costco (COST) is anticipated to benefit from increased sales as consumers engage in pantry-loading ahead of the storm, similar to past events [4] - Anecdotal evidence shows crowded Costco stores in states like Texas and Florida, with shares up 13% year-to-date [5] Restaurant and Retail Sector Challenges - Dine-in restaurants and discretionary retail are likely to face revenue headwinds due to consumers staying indoors during the storm [5][6] - Several restaurant companies have previously reported traffic declines during severe winter weather [6] Capital One Acquisition - Capital One (COF) has announced the acquisition of fintech company Brex for $5.15 billion, with the deal structured as 50% cash and 50% stock [7][8] - This acquisition aims to enhance Capital One's capabilities in serving corporate clients through Brex's technology for corporate cards and expense management [8] Intel Earnings Report - Intel (INTC) reported stronger-than-expected Q4 results but provided a Q1 outlook that fell below analyst expectations, leading to a 12% drop in premarket shares [9][10] - The company expects Q1 revenue between $11.7 billion and $12.7 billion, with adjusted earnings per share projected to break even [10]

Industry Overview - The Zacks Retail – Restaurants industry is facing challenges due to a tough macroeconomic environment, high costs, and declining traffic, making it difficult for restaurants to maintain margins as labor and food costs fluctuate unpredictably [1][4] - Despite these challenges, the industry is benefiting from partnerships with delivery channels and digital platforms, which are expected to drive growth [1][6] Current Trends - U.S. restaurant visits are declining as consumers prioritize essential spending over dining out, particularly affecting lower and middle-income households [3] - Elevated labor costs and volatile food input costs are compressing margins, forcing operators to absorb higher costs and resulting in tighter margins and slower earnings growth [4] - Many restaurant chains are increasing promotions and discounts to defend traffic, which may stabilize short-term sales but could dilute average checks and pressure margins [5] Growth Drivers - Digital innovation and partnerships with delivery services like DoorDash and Uber Eats are crucial for driving incremental sales [6] - The rise in off-premise sales, including delivery and takeout, is acting as a key catalyst for the industry, with many operators testing ghost kitchens and enhancing curbside services [7] Industry Performance - The Zacks Restaurant industry is ranked 210, placing it in the bottom 14% of over 244 Zacks industries, indicating dull near-term prospects [8] - Over the past year, the industry has underperformed the S&P 500, declining 3.2% compared to the S&P 500's rise of 13.6% [10] Valuation Metrics - The industry is currently trading at a forward 12-month P/E of 24.46X, which is higher than the S&P 500's 22.81X but below the sector's 25.05X [13] Company Highlights - **Brinker International, Inc. (EAT)**: The company is benefiting from increased menu pricing and effective marketing strategies, with anticipated sales and earnings growth of 6.5% and 15.1% respectively for fiscal 2026 [16][17] - **BJ's Restaurants, Inc. (BJRI)**: The company is focused on growing traffic and enhancing operational efficiency, with expected sales and earnings growth of 2.4% and 3.3% respectively for 2026 [20][21] - **Chipotle Mexican Grill, Inc. (CMG)**: The company is reinforcing long-term growth through high-quality ingredients and digital innovation, although it has seen a decline of 29.3% in shares over the past year, with projected sales and earnings growth of 9.4% and 3.4% respectively for 2026 [24][25]

Core Insights - Zacks Premium offers tools for investors to enhance their stock market engagement and confidence, including daily updates, research reports, and stock screens [1] Zacks Style Scores - The Zacks Style Scores are indicators that help investors select stocks likely to outperform the market in the next 30 days, rated from A to F based on value, growth, and momentum characteristics [2] Value Score - The Value Style Score identifies attractive and discounted stocks using ratios like P/E, PEG, Price/Sales, and Price/Cash Flow [3] Growth Score - The Growth Style Score focuses on a stock's future prospects and financial health, analyzing projected and historical earnings, sales, and cash flow [4] Momentum Score - The Momentum Style Score helps investors capitalize on price trends, using factors like one-week price change and monthly earnings estimate changes [5] VGM Score - The VGM Score combines all three Style Scores, serving as a key indicator alongside the Zacks Rank to identify stocks with strong value, growth, and momentum [6] Zacks Rank - The Zacks Rank is a proprietary stock-rating model that uses earnings estimate revisions to simplify portfolio building, with 1 (Strong Buy) stocks achieving an average annual return of +23.9% since 1988, outperforming the S&P 500 [7][8] Stock Selection Strategy - Investors should focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B to maximize success potential; stocks with a 3 rank should also have high Style Scores for better upside [9] - Stocks rated 4 (Sell) or 5 (Strong Sell) pose a higher risk, even if they have good Style Scores, due to declining earnings forecasts [10] Company Spotlight: BJ's Restaurants - BJ's Restaurants operates a chain of high-end casual dining restaurants in the U.S. and currently holds a 3 (Hold) Zacks Rank with a VGM Score of A [11] - The company has a Momentum Style Score of B, with shares increasing by 9.8% over the past four weeks [11] - Recent earnings estimates for fiscal 2025 have been revised higher, with the Zacks Consensus Estimate increasing by $0.01 to $2.20 per share, and an average earnings surprise of +155.6% [12]

Financial Data and Key Metrics Changes - The company reported impressive average unit volumes (AUVs) nearing $6.5 million, with five consecutive quarters of positive traffic growth, indicating strong operational performance [1][9][21] - Restaurant margins are anticipated to increase by nearly 100 basis points this year, contributing to raised EBITDA guidance for 2025 [21][22] Business Line Data and Key Metrics Changes - The Pizookie Meal Deal has been a significant driver of traffic, providing both existing and new customers with a value entry point into the brand, which has positively impacted frequency and sales [11][18] - The company has focused on foundational operations and product innovation, including a pizza category refresh and seasonal Pizookies, which are expected to enhance customer experience and drive sales [14][15] Market Data and Key Metrics Changes - The company has seen improvements in Net Promoter Scores (NPS), team member retention, and value scores, which are correlated with sales and profitability [10][22] - The late-night segment has experienced outsized growth, contributing to overall traffic increases despite a smaller average check size [18][19] Company Strategy and Development Direction - The company is focused on four strategic priorities: team member experience, menu management, operational excellence, and customer experience, which are foundational to its growth strategy [4][15] - There is a plan to resume unit growth, with two new units expected to open in the second half of the year and a potential target of 425 units in the future, emphasizing a careful analysis of market opportunities [26][31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's trajectory, emphasizing the importance of consistency and foundational strategies to build a durable business [36] - The company aims to leverage its cash flow for strategic initiatives, including remodels and potential new unit growth, while maintaining a disciplined approach to share repurchases [33][34] Other Important Information - The company has implemented a robust outlier management program to improve operational efficiency and accountability, which has contributed to margin expansion [22][23] - Management is open to exploring different restaurant formats and locations to optimize growth and returns, reflecting a flexible approach to expansion [30] Q&A Session Summary Question: What foundational changes have been made to improve operations? - Management highlighted alignment and accountability as key changes, focusing on team member experience and operational execution [3][4] Question: What attracted the new CFO to the company? - The CFO was drawn to the strong business model, high AUVs, and the opportunity to build on recent successes [7][8] Question: What are the drivers of recent traffic growth? - Improved operational execution, NPS scores, and the Pizookie Meal Deal have been significant contributors to traffic increases [10][11] Question: How does the company view average check trends? - Management noted that while the Pizookie Meal Deal has driven traffic, it has also introduced new customer cohorts, which may affect average check size but is not necessarily a headwind [16][19] Question: What are the biggest drivers of improving margins? - Foundational operational improvements and accountability measures have been key to enhancing restaurant margins [21][22] Question: What is the outlook for unit growth? - Management is optimistic about resuming unit growth, with a focus on strategic locations and potential for market expansion [26][31]

Financial Data and Key Metrics Changes - The company reported impressive average unit volumes (AUVs) nearing $6.5 million, with five consecutive quarters of positive traffic growth, indicating strong operational performance [1][10] - Restaurant margins are anticipated to increase by nearly 100 basis points this year, contributing to raised EBITDA guidance for 2025 [20][21] Business Line Data and Key Metrics Changes - The Pizookie Meal Deal has been a significant driver of traffic, providing both existing and new customers with a value entry point into the brand, which has positively impacted frequency and sales [12][19] - The company has focused on foundational operations and product innovation, including a pizza category refresh and seasonal Pizookies, which are expected to enhance customer experience and drive sales [14][23] Market Data and Key Metrics Changes - The company has seen outsized growth in late-night sales, contributing to overall traffic increases, although these checks may be smaller in absolute terms [18][19] - The management noted that there is still significant headroom for growth in most markets, indicating potential for expansion without cannibalization [27][29] Company Strategy and Development Direction - The company is focused on foundational strategies that emphasize operational excellence, team member experience, and product innovation, aiming for sustainable growth and profit expansion [15][34] - There is a strategic shift towards unit growth, with plans to open two new units in the second half of the year and a longer-term goal of reaching approximately 425 units [25][29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's trajectory, emphasizing the importance of consistency and long-term planning over short-term results [34] - The leadership team is committed to building a more durable business model that can support new unit growth while maintaining operational efficiency [32][34] Other Important Information - The company has implemented a structured share buyback program, which has been more aggressive this year compared to historical levels, reflecting confidence in the stock's valuation [31][33] - Management highlighted the importance of investing in remodels and capital improvements to ensure team members have the necessary tools to deliver quality service [32] Q&A Session Summary Question: What foundational changes have been made to improve operations? - Management discussed alignment and accountability as key focuses, leading to improved team member experience and operational execution [3][4] Question: What attracted the new CFO to BJ's? - The CFO highlighted the strong business model, high AUVs, and positive traffic-driven sales growth as major attractions [7][8] Question: What are the drivers of recent traffic growth? - Management attributed traffic growth to improved operational execution, enhanced NPS scores, and effective marketing strategies around the Pizookie Meal Deal [11][12] Question: How does the company view average check trends? - Management noted that while the Pizookie Meal Deal may compress average checks, it brings in new customers and drives overall traffic, which is beneficial in the long run [17][19] Question: What are the biggest drivers of improving margins? - The focus on foundational operations and accountability at all levels has led to improved restaurant margins [21][22] Question: What is the outlook for unit growth? - Management indicated a cautious but optimistic approach to unit growth, with plans to analyze past performance and market conditions before committing to a specific number [26][29]

Financial Data and Key Metrics Changes - The company reported impressive average unit volumes (AUVs) nearing $6.5 million, with five consecutive quarters of positive traffic growth, indicating strong operational performance [1][11] - Restaurant margins are anticipated to increase by nearly 100 basis points this year, contributing to raised EBITDA guidance for 2025 [22][36] Business Line Data and Key Metrics Changes - The Pizookie Meal Deal has been a significant driver of traffic, providing both existing and new customers with an entry point into the brand, which has positively impacted frequency and sales [13][20] - The company has focused on foundational operations and product innovation, including a pizza category refresh and seasonal Pizookies, which have contributed to improved customer experience and operational efficiency [15][26] Market Data and Key Metrics Changes - The company has experienced a 3.5% increase in traffic, which is a strong performance in the casual dining industry, driven by improved operational execution and customer satisfaction [11][12] - The late-night segment has shown outsized growth, contributing to overall traffic increases despite a smaller average check size [20] Company Strategy and Development Direction - The company is focused on foundational strategies that enhance operational efficiency and customer experience, with an emphasis on team member experience and accountability [4][17] - There is a strategic plan to resume unit growth, with two new units expected to open in the second half of the year, aiming for a long-term target of 425 units, nearly double the current count [28][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's trajectory, emphasizing the importance of consistency and long-term growth strategies rather than short-term gains [38] - The leadership team is committed to building a more sustainable and durable business model, which includes leveraging cash flow for strategic initiatives and potential unit growth [34][36] Other Important Information - The company has implemented a structured share buyback program, which has been more aggressive than in previous years, reflecting confidence in the stock's undervaluation [35] - Management highlighted the importance of operational accountability and efficiency improvements, which have been key drivers of margin expansion [23][26] Q&A Session Summary Question: What are the most impactful drivers of traffic growth over the last 12 months? - Management attributed traffic growth to improved operational execution, higher NPS scores, and the success of the Pizookie Meal Deal, which has encouraged repeat visits [12][13] Question: How does the company view average check trends moving forward? - Management noted that while the Pizookie Meal Deal has brought in traffic, it has also led to a lower average check size; however, they see opportunities to manage mix and build basket size over time [19][20] Question: What are the biggest drivers of improving margins? - The improvement in margins has been driven by foundational operational work, accountability measures, and simplification of processes that enhance guest experience and reduce costs [22][23] Question: What is the outlook for unit growth? - Management indicated that they are analyzing their remodels and new restaurant openings to ensure capital is used effectively, with plans to resume unit growth in the near future [28][30] Question: How does the company plan to utilize its cash flow? - The company plans to fund strategic initiatives, continue share buybacks when the stock is undervalued, and invest in remodels and operational improvements [34][36]