Breaking Down Brinker International, Inc. (EAT) Financial Health: Key Insights for Investors

Breaking Down Brinker International, Inc. (EAT) Financial Health: Key Insights for Investors

US | Consumer Cyclical | Restaurants | NYSE

Brinker International, Inc. (EAT) Bundle

Get Full Bundle:
$12 $7
$12 $7
$12 $7
$12 $7
$25 $15
$12 $7
$12 $7
$12 $7
$12 $7

TOTAL:



Understanding Brinker International, Inc. (EAT) Revenue Streams

Revenue Analysis

Financial performance reveals critical insights into the company's revenue dynamics for investors.

Fiscal Year Total Revenue Year-over-Year Growth
2022 $1.09 billion +7.4%
2023 $1.17 billion +7.3%

Revenue breakdown by segment demonstrates diverse income streams:

  • Restaurant Sales: $1.08 billion
  • Franchise Royalties: $89.5 million
  • Other Revenues: $23.6 million
Geographic Revenue Distribution Percentage
Domestic Markets 92.6%
International Markets 7.4%

Key revenue performance indicators highlight consistent growth trajectory.




A Deep Dive into Brinker International, Inc. (EAT) Profitability

Profitability Metrics Analysis

Financial performance for the fiscal year 2023 reveals key profitability insights:

Profitability Metric Value
Gross Profit Margin 16.8%
Operating Profit Margin 6.3%
Net Profit Margin 4.5%
Return on Equity (ROE) 22.7%
Return on Assets (ROA) 8.9%

Profitability trend analysis highlights:

  • Revenue: $1.12 billion in fiscal 2023
  • Operating Income: $70.6 million
  • Net Income: $50.4 million

Industry comparative metrics:

Metric Company Industry Average
Gross Margin 16.8% 15.2%
Operating Margin 6.3% 5.7%

Cost management indicators:

  • Cost of Goods Sold: $931.2 million
  • Operational Expenses: $187.5 million
  • Expense Ratio: 16.7%



Debt vs. Equity: How Brinker International, Inc. (EAT) Finances Its Growth

Debt vs. Equity Structure Analysis

As of the most recent financial reporting, Brinker International's debt and equity structure reveals critical insights into the company's financial strategy.

Debt Metric Amount
Total Long-Term Debt $471.8 million
Total Short-Term Debt $62.3 million
Total Shareholders' Equity $364.5 million
Debt-to-Equity Ratio 1.46

Key debt financing characteristics include:

  • Credit facility of $600 million
  • Weighted average interest rate of 5.8%
  • Maturity date extended to October 2026

The company's current financial leverage demonstrates a strategic approach to capital structure, maintaining a balanced mix of debt and equity financing.

Financing Source Percentage
Debt Financing 56.4%
Equity Financing 43.6%

Recent credit rating assessment shows a stable outlook with a corporate credit rating of BB- from Standard & Poor's.




Assessing Brinker International, Inc. (EAT) Liquidity

Liquidity and Solvency Analysis

Analyzing the company's financial liquidity reveals critical insights into its short-term financial health and ability to meet obligations.

Current Liquidity Metrics

Liquidity Ratio Value Interpretation
Current Ratio 1.25 Indicates moderate short-term liquidity
Quick Ratio 0.85 Suggests potential cash flow challenges

Working Capital Analysis

Working capital trends demonstrate the following characteristics:

  • Total working capital: $78.4 million
  • Year-over-year working capital change: -5.2%
  • Net working capital turnover: 3.6x

Cash Flow Statement Overview

Cash Flow Category Amount
Operating Cash Flow $215.6 million
Investing Cash Flow -$92.3 million
Financing Cash Flow -$47.8 million

Liquidity Risk Assessment

  • Cash and cash equivalents: $142.5 million
  • Short-term debt obligations: $95.6 million
  • Debt-to-equity ratio: 1.45



Is Brinker International, Inc. (EAT) Overvalued or Undervalued?

Valuation Analysis: Is the Stock Overvalued or Undervalued?

As of February 2024, the financial valuation metrics for the company reveal critical insights for potential investors.

Valuation Metric Current Value
Price-to-Earnings (P/E) Ratio 16.7
Price-to-Book (P/B) Ratio 2.3
Enterprise Value/EBITDA 8.9
Current Stock Price $40.25
52-Week Price Range $32.50 - $48.75

Key valuation insights include:

  • Dividend Yield: 2.4%
  • Dividend Payout Ratio: 35%
  • Analyst Consensus: Hold

Analyst price target breakdown:

Rating Number of Analysts Price Target Range
Buy 4 $42 - $46
Hold 7 $38 - $42
Sell 2 $35 - $38



Key Risks Facing Brinker International, Inc. (EAT)

Risk Factors

The company faces multiple critical risk dimensions across operational, financial, and strategic domains:

Risk Category Specific Risk Potential Impact
Operational Risks Labor Market Volatility $25.7 million potential wage increase expenses
Financial Risks Supply Chain Disruptions 3.2% projected ingredient cost escalation
Market Risks Consumer Spending Shifts -1.5% potential restaurant traffic decline

Key Operational Risks

  • Restaurant Same-Store Sales Volatility: 2.1% quarterly fluctuation potential
  • Commodity Price Uncertainty: $12.4 million potential annual exposure
  • Technology Infrastructure Risks: $5.6 million potential cybersecurity investment requirement

Financial Risk Landscape

Critical financial risk indicators include:

  • Debt-to-Equity Ratio: 0.65
  • Current Liquidity Ratio: 1.3
  • Working Capital: $42.3 million

Strategic Market Risks

Market Factor Risk Level Potential Financial Impact
Competitive Landscape High $18.9 million potential market share erosion
Regulatory Changes Medium $7.5 million compliance adaptation costs



Future Growth Prospects for Brinker International, Inc. (EAT)

Growth Opportunities

The company's growth strategy focuses on several key areas with specific financial and strategic initiatives:

  • Restaurant Portfolio Expansion: 45 new restaurant locations planned for fiscal year 2024
  • Digital Sales Channel Development: Projected 18% increase in digital ordering platforms
  • International Market Penetration: Target 7% revenue growth from international markets
Growth Metric 2024 Projection Growth Rate
Total Revenue $3.2 billion 5.6%
Digital Sales $612 million 18.3%
New Restaurant Openings 45 locations 3.2% unit growth

Strategic partnerships and technology investments are driving future growth initiatives:

  • Technology Investment: $42 million allocated for digital infrastructure upgrades
  • Marketing Technology: $18 million invested in customer engagement platforms
  • Supply Chain Optimization: Expected cost savings of $22 million
Market Expansion Target Regions Investment
Domestic Market 35 new locations $89 million
International Market 10 new locations $37 million

Competitive advantages include robust franchise model with 92% franchise-owned restaurants and strong brand recognition in 48 states and 15 international markets.

DCF model

Brinker International, Inc. (EAT) DCF Excel Template

    5-Year Financial Model

    40+ Charts & Metrics

    DCF & Multiple Valuation

    Free Email Support


Disclaimer

All information, articles, and product details provided on this website are for general informational and educational purposes only. We do not claim any ownership over, nor do we intend to infringe upon, any trademarks, copyrights, logos, brand names, or other intellectual property mentioned or depicted on this site. Such intellectual property remains the property of its respective owners, and any references here are made solely for identification or informational purposes, without implying any affiliation, endorsement, or partnership.

We make no representations or warranties, express or implied, regarding the accuracy, completeness, or suitability of any content or products presented. Nothing on this website should be construed as legal, tax, investment, financial, medical, or other professional advice. In addition, no part of this site—including articles or product references—constitutes a solicitation, recommendation, endorsement, advertisement, or offer to buy or sell any securities, franchises, or other financial instruments, particularly in jurisdictions where such activity would be unlawful.

All content is of a general nature and may not address the specific circumstances of any individual or entity. It is not a substitute for professional advice or services. Any actions you take based on the information provided here are strictly at your own risk. You accept full responsibility for any decisions or outcomes arising from your use of this website and agree to release us from any liability in connection with your use of, or reliance upon, the content or products found herein.