What Happened?
Shares of casual restaurant chain Brinker International (NYSE:EAT) jumped 6.1% in the morning session after investors focused on the company's previously reported upbeat quarterly earnings from late October.
Brinker International posted positive results on October 29, with CEO Kevin Hochman highlighting that its Chili's brand “continues to deliver industry leading results with first quarter sales of +21% and traffic of +13%, against a tough macro environment.” The move also appeared supported by the company's strong financial health. Reports noted Brinker's notable profit generation and effective use of capital, with key financial measures showing a record of operational effectiveness.
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What Is The Market Telling Us
Brinker International’s shares are very volatile and have had 24 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 9 days ago when the stock dropped 3.8% on the news that investor sentiment soured amid weak earnings expectations for the company's upcoming quarterly report. Projections for the restaurant operator pointed to an 8.9% decline in earnings per share compared to the same period in the previous year. Adding to the concern, the consensus estimate for these earnings had been revised downward by 2.8% over the preceding 30 days. This change suggested a more pessimistic outlook on the company's near-term financial performance, which weighed on the stock.
Brinker International is down 18.3% since the beginning of the year, and at $112.46 per share, it is trading 40.5% below its 52-week high of $189.14 from February 2025. Investors who bought $1,000 worth of Brinker International’s shares 5 years ago would now be looking at an investment worth $2,442.
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