Red Robin Gourmet Burgers (RRGB) PT Slashed 43% to $16 at Jefferies After Printing Near 20% SSS Growth

Jefferies analyst Andy Barish lowered the price target on Red Robin Gourmet Burgers (NASDAQ: RRGB) to $16.00 (from $28.00) after reporting a 1Q beat on SSS of 19.7% vs consensus of 16% and RLM upside (+40bps). Staffing headwinds are easing and the continued overall economic recovery at dine-in driving is showing solid momentum. Second quarter to-date SSS is +7.3% comparing very favorably with the 2019 (+3.9% in 1Q). FY EBITDA guide was reiterated at $80-90m as improved sales guidance is offset by a more cautious commodity outlook.

The analyst reiterated a Buy rating, stating "We see multiple tailwinds at off-prem and structural efficiencies from menu/labor model that give us confidence in cont'd momentum through ’22-23. We believe risk/reward for RRGB at current valuation among most attractive at trough multiples relative to category peers, and see tangible drivers of SSS upside beyond the NT that have yet to be fully reflected at current levels."

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