William Blair Upgrades BJ's Restaurants (BJRI) to Outperform

William Blair analyst Sharon Zackfia upgraded BJ's Restaurants (NASDAQ: BJRI) from Market Perform to Outperform.

The analyst commented: "We are upgrading BJ’s to Outperform as we believe sales continue to build momentum with the potential for significant upside to consensus expectations this year and next on both the top and bottom lines. We expect the eighth straight quarter of comp and traffic growth in the second quarter, and suspect comps will easily exceed consensus of 2.5% while potentially reaching the midsingle-digit range (which would represent the brand’s best comp in three years). We view consistently positive comp trends and growing brand momentum as testament to the success of both menu innovation (Pizookie Meal Deals, seasonal Pizookies, and a revamped pizza platform) and improved operations (NPS up 10% over the past 2 years). Inclusive of ongoing traffic-driving menu innovation (such as a revitalized chicken sandwich line-up that launched at the end of June), we believe upside exists to both comp guidance of 1% to 3% this year as well as adjusted EBITDA guidance of $140 million to $150 million, and we see a scenario in which full-year comps could reach the midsingle-digit range while delivering profit $5 million to $10 million ahead of guidance. In the interim, we are raising our second-quarter comp estimate to a Street-high 3% with Street-high profitability while also raising our full-year adjusted EBITDA estimate above guidance to $151.3 million (3.5% above consensus)."

For an analyst ratings summary and ratings history on BJ's Restaurants click here. For more ratings news on BJ's Restaurants click here.

Shares of BJ's Restaurants closed at $62.47 yesterday.

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