Fact based stock research
Brinker (NYSE:EAT)
US1096411004
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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Brinker stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 21 (worse than 79% compared with investment alternatives), Brinker (Restaurants, USA) shares have lower financial characteristics compared with similar stocks. Shares of Brinker are low in value (priced high) with a consolidated Value Rank of 5 (worse than 95% of alternatives), and are riskily financed (Safety Rank of 39, which means above-average debt burdens) but show above-average growth (Growth Rank of 81). ...read more
RECOMMENDATION: A Combined Rank of 21, is a sell recommendation based on Brinker's financial characteristics. As the company Brinker shows low value with an Obermatt Value Rank of 5 (95% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 81% of comparable companies (Obermatt Growth Rank is 81). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 39 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Brinker, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° Viewnew| Country | USA |
| Industry | Restaurants |
| Index | Dividends USA |
| Size class | X-Large |
14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Brinker
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 93 |
|
99 |
|
86 |
|
5 |
|
| GROWTH | ||||||||
| GROWTH | 72 |
|
5 |
|
61 |
|
81 |
|
| SAFETY | ||||||||
| SAFETY | 7 |
|
12 |
|
16 |
|
39 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
56 |
|
58 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
27 |
|
59 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 21 (worse than 79% compared with investment alternatives), Brinker (Restaurants, USA) shares have lower financial characteristics compared with similar stocks. Shares of Brinker are low in value (priced high) with a consolidated Value Rank of 5 (worse than 95% of alternatives), and are riskily financed (Safety Rank of 39, which means above-average debt burdens) but show above-average growth (Growth Rank of 81). ...read more
RECOMMENDATION: A Combined Rank of 21, is a sell recommendation based on Brinker's financial characteristics. As the company Brinker shows low value with an Obermatt Value Rank of 5 (95% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 81% of comparable companies (Obermatt Growth Rank is 81). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 39 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Brinker, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 93 |
|
99 |
|
86 |
|
5 |
|
| GROWTH | ||||||||
| GROWTH | 72 |
|
5 |
|
61 |
|
81 |
|
| SAFETY | ||||||||
| SAFETY | 7 |
|
12 |
|
16 |
|
39 |
|
| COMBINED | ||||||||
| COMBINED | 33 |
|
24 |
|
59 |
|
21 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 5 (worse than 95% compared with alternatives), Brinker shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for Brinker. Price-to-Sales (P/S) is 50, which means that the stock price compared with what market professionals expect for future sales is lower than 50% of comparable companies, indicating a good value concerning to Brinker's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 1, meaning that dividends are expected to be lower than for 99% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 97% of alternatives (only 3% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 54% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 5, is a sell recommendation based on Brinker's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in Brinker could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, Brinker looks like an expensive investment today. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 80 |
|
93 |
|
85 |
|
50 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 93 |
|
97 |
|
90 |
|
46 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 100 |
|
81 |
|
97 |
|
3 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 1 |
|
72 |
|
1 |
|
1 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 93 |
|
99 |
|
86 |
|
5 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 81 (better than 81% compared with alternatives) for 2024, Brinker shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Brinker. Profit Growth has a rank of 84, which means that currently professionals expect the company to grow its profits more than 84% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 100 (above 100% of alternative investments). But Sales Growth has a below the median rank of 38, which means that, currently, professionals expect the company to grow less than 62% of its competitors, and Capital Growth also has a lower rank of 36. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 81, is a buy recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for Brinker. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 78 |
|
17 |
|
39 |
|
38 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 27 |
|
22 |
|
60 |
|
84 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
15 |
|
49 |
|
36 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 28 |
|
5 |
|
67 |
|
100 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 72 |
|
5 |
|
61 |
|
81 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 39 (better than 39% compared with alternatives), the company Brinker has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Brinker is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Brinker. Liquidity is at 70, meaning the company generates more profit to service its debt than 70% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 39, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 61% of its competitors. Leverage is also high at a rank of 33, which means that the company has an above-average debt-to-equity ratio. It has more debt than 67% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 39 (worse than 61% compared with alternatives), Brinker has a financing structure that is riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. If the company is sailing with good winds, as may be visible from the Growth and Sentiment performance, the refinancing risk may be lower than the low Refinancing rank suggests. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 6 |
|
12 |
|
20 |
|
33 |
|
| REFINANCING | ||||||||
| REFINANCING | 6 |
|
10 |
|
16 |
|
39 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 33 |
|
78 |
|
50 |
|
70 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 7 |
|
12 |
|
16 |
|
39 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
35 |
|
3 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
50 |
|
54 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
72 |
|
78 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
42 |
|
71 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
56 |
|
58 |
|
new |
|
Free stock analysis by the purely fact based Obermatt Method for Brinker from November 14, 2024.
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