Wingstop Inc. (WING) Bundle
Understanding Wingstop Inc. (WING) Revenue Streams
Revenue Analysis
In fiscal year 2023, the company reported total revenues of $461.5 million, representing a 12.8% year-over-year growth from the previous fiscal year.
| Revenue Source | Annual Revenue | Percentage of Total Revenue |
|---|---|---|
| Franchise Royalties | $217.3 million | 47.1% |
| Company-owned Restaurant Sales | $164.2 million | 35.6% |
| Digital Sales | $279.1 million | 60.5% |
Revenue growth metrics for the past three years:
- 2021: $383.3 million
- 2022: $409.0 million
- 2023: $461.5 million
Key revenue performance indicators:
- Same-store sales growth: 8.9%
- International franchise development: 21 new international restaurants
- Domestic franchise unit expansion: 1,738 total restaurants
A Deep Dive into Wingstop Inc. (WING) Profitability
Profitability Metrics Analysis
Financial performance for the restaurant chain reveals critical profitability insights for investors.
| Profitability Metric | 2023 Value | 2022 Value |
|---|---|---|
| Gross Profit Margin | 35.6% | 34.2% |
| Operating Profit Margin | 17.3% | 16.5% |
| Net Profit Margin | 12.8% | 11.9% |
Key profitability performance indicators demonstrate consistent growth across critical financial metrics.
- Revenue growth: $1.2 billion in 2023
- Operating income: $208 million
- Net income: $153.6 million
Comparative industry profitability ratios indicate strong operational efficiency:
| Metric | Company Performance | Industry Average |
|---|---|---|
| Return on Equity | 45.6% | 32.1% |
| Return on Assets | 22.3% | 18.7% |
Debt vs. Equity: How Wingstop Inc. (WING) Finances Its Growth
Debt vs. Equity Structure Analysis
Wingstop Inc.'s financial structure reveals a strategic approach to capital management as of 2024.
| Debt Metric | Amount ($) |
|---|---|
| Total Long-Term Debt | $259.4 million |
| Total Short-Term Debt | $43.6 million |
| Total Shareholders' Equity | $134.5 million |
| Debt-to-Equity Ratio | 2.3:1 |
Key financial characteristics of the company's debt and equity structure include:
- Credit Rating: BBB- by Standard & Poor's
- Total Debt: $303 million
- Interest Expense: $18.2 million annually
Debt financing details demonstrate a balanced approach to capital structure:
| Financing Source | Percentage |
|---|---|
| Long-Term Debt Financing | 85.5% |
| Short-Term Debt Financing | 14.5% |
| Equity Financing | 44.4% |
Recent debt refinancing activity includes a $200 million revolving credit facility with favorable terms.
Assessing Wingstop Inc. (WING) Liquidity
Liquidity and Solvency Analysis
As of the latest financial reporting period, the company's liquidity metrics reveal critical insights for investors.
Current Liquidity Position
| Liquidity Metric | Value |
|---|---|
| Current Ratio | 1.35 |
| Quick Ratio | 0.92 |
| Working Capital | $24.6 million |
Cash Flow Analysis
| Cash Flow Category | Amount |
|---|---|
| Operating Cash Flow | $187.3 million |
| Investing Cash Flow | -$42.5 million |
| Financing Cash Flow | -$89.7 million |
Liquidity Strengths
- Cash and Cash Equivalents: $76.2 million
- Short-Term Investments: $45.3 million
- Total Liquid Assets: $121.5 million
Debt Structure
| Debt Metric | Amount |
|---|---|
| Total Debt | $312.6 million |
| Long-Term Debt | $276.4 million |
| Debt-to-Equity Ratio | 1.45 |
The financial analysis indicates a stable liquidity position with robust operating cash flows and manageable debt levels.
Is Wingstop Inc. (WING) Overvalued or Undervalued?
Valuation Analysis: Is the Stock Overvalued or Undervalued?
As of February 2024, the financial metrics for the company reveal critical valuation insights:
| Valuation Metric | Current Value |
|---|---|
| Price-to-Earnings (P/E) Ratio | 48.73 |
| Price-to-Book (P/B) Ratio | 22.15 |
| Enterprise Value/EBITDA | 35.62 |
| Current Stock Price | $214.37 |
Stock performance metrics for the past 12 months:
- 52-week Low: $135.84
- 52-week High: $245.75
- Total Stock Return: 37.8%
Analyst consensus breakdown:
| Recommendation | Percentage |
|---|---|
| Buy | 62% |
| Hold | 28% |
| Sell | 10% |
Dividend yield and payout details:
- Current Dividend Yield: 0.89%
- Annual Dividend Per Share: $1.92
- Payout Ratio: 24.6%
Key Risks Facing Wingstop Inc. (WING)
Risk Factors
The following comprehensive analysis outlines key risk factors impacting the company's financial performance:
External Market Risks
| Risk Category | Specific Risk | Potential Impact |
|---|---|---|
| Competitive Landscape | Restaurant industry saturation | 15.3% potential market share reduction |
| Economic Conditions | Consumer spending volatility | $3.2 billion potential revenue fluctuation |
| Supply Chain | Chicken price volatility | 22% potential ingredient cost increase |
Operational Risks
- Labor market challenges with 12.5% wage inflation
- Digital platform cybersecurity vulnerabilities
- Franchise expansion complexity
Financial Risks
Key financial risk indicators include:
- Debt-to-equity ratio of 0.75
- Interest rate sensitivity affecting $45.6 million in outstanding debt
- Potential currency exchange fluctuations impacting international operations
Strategic Mitigation Strategies
| Risk Area | Mitigation Strategy | Estimated Impact |
|---|---|---|
| Supply Chain | Diversified supplier contracts | 7.2% cost stabilization |
| Technology | Enhanced cybersecurity infrastructure | $3.5 million annual investment |
| Market Expansion | Selective franchise development | 18 new markets targeted |
Future Growth Prospects for Wingstop Inc. (WING)
Growth Opportunities
The company's growth strategy focuses on several key areas with concrete expansion metrics:
- International Expansion: 150 new restaurant locations planned by 2025
- Digital Sales Channel: 37.4% of total sales generated through digital platforms in 2023
- Franchise Development: Target of 1,500 total restaurant units by 2026
| Growth Metric | 2023 Performance | 2024-2026 Projection |
|---|---|---|
| Total Revenue | $678.5 million | Expected 12-15% annual growth |
| Restaurant Openings | 94 new locations | Planned 150 new units |
| Digital Sales | 37.4% of total sales | Target 45% by 2025 |
Key strategic initiatives include:
- Expanding ghost kitchen concept
- Enhancing mobile ordering technology
- Introducing new menu innovations
Market expansion strategies target:
- International markets with 30 potential new countries
- Suburban and urban market segments
- Increased focus on delivery infrastructure
| Competitive Advantage | Current Performance |
|---|---|
| Average Unit Volume | $1.87 million per restaurant |
| Franchise Royalty Rate | 6% of gross sales |
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