Texas Roadhouse (TXRH) Valuation Check as New CFO and Leadership Team Take the Helm
Texas Roadhouse (TXRH) just reshuffled its leadership bench, naming veteran restaurant finance executive Mike Lenihan as CFO, while elevating long time insider Keith Humpich and legal leader Sean Renfroe to expanded roles.
See our latest analysis for Texas Roadhouse.
The leadership shake up lands at a time when the stock is consolidating after a strong multi year run, with a modest year to date share price pullback but a still impressive three year total shareholder return of roughly 83% signalling that long term momentum remains intact.
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With earnings still growing near double digits and the shares trading about 12 percent below Wall Street targets and an even bigger gap to some intrinsic estimates, is Texas Roadhouse quietly undervalued, or is the market already baking in every ounce of future growth?
Most Popular Narrative Narrative: 11.1% Undervalued
With Texas Roadhouse last closing at $168.24 versus a widely followed fair value near $189, the dominant narrative leans toward upside still on the table.
Analysts are assuming Texas Roadhouse's revenue will grow by 9.1% annually over the next 3 years. Analysts assume that profit margins will increase from 7.7% today to 8.1% in 3 years time.
Curious how mid single digit margin gains and steady double digit style earnings power can justify a richer future multiple than today? See how this narrative connects the dots.
Result: Fair Value of $189.16 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, persistent beef inflation and slower digital adoption could squeeze margins and blunt traffic gains, quickly challenging the idea that Texas Roadhouse remains undervalued.
Find out about the key risks to this Texas Roadhouse narrative.
Build Your Own Texas Roadhouse Narrative
If you see Texas Roadhouse's story differently or want to dig into the numbers yourself, you can build a custom narrative in just a few minutes: Do it your way.
A great starting point for your Texas Roadhouse research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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