Last Update 07 Dec 25

BJRI: New Leadership And Margin Initiatives Will Drive Measured Upside Ahead

Analysts have modestly raised their price target on BJ's Restaurants to $38.88 from $38.88. This reflects slightly lower discount rate assumptions, a small improvement in projected profit margins, and a balanced read of recent Street research that highlights both new Buy initiation upside and tempered same-store-sales expectations.

Analyst Commentary

Recent Street commentary presents a mixed but generally constructive view on BJ's Restaurants, as investors weigh new leadership and operational initiatives against softer industry traffic and near term sales headwinds.

Bullish Takeaways

Bullish analysts view the current share price as offering a compelling risk reward profile, with upside potential if management executes on planned sales and margin initiatives.
New leadership is seen as a catalyst for sharper execution, particularly around menu optimization, marketing, and disciplined cost control that could support sustained margin expansion.
Upcoming sales drivers, including promotional innovation and potential digital and loyalty enhancements, are expected to reaccelerate same store sales growth and support a premium to historical valuation averages.
Expectations for continued margin improvement underpin support for price targets above the current level, assuming the company can convert operational efficiencies into durable earnings growth.

Bearish Takeaways

Bearish analysts are cautious that same store sales may fall short of prior expectations, citing softer industry demand trends and tougher comparisons after last year's promotional launches.
Near term earnings risk around upcoming quarterly results is seen as limiting multiple expansion, as any top line miss could pressure the valuation back toward the lower end of the targeted range.
There is concern that promotional intensity required to drive traffic could partially offset margin gains, tempering the pace of earnings growth embedded in more aggressive price targets.
Some observers argue that, even with operational progress, the current backdrop for casual dining constrains upside, warranting a more neutral stance until visibility on sustained traffic recovery improves.

What's in the News

Launched two holiday limited time dessert offerings: the new Dubai Chocolate Pizookie and the returning fan favorite Monkey Bread Pizookie, supported by national gift card and bonus card promotions for in restaurant and online guests (company announcement).
Appointed Todd Wilson as Chief Financial Officer effective December 15, 2025, adding an executive with prior CFO experience at Red Robin Gourmet Burgers, Hopdoddy Burger Bar and finance leadership roles at Jamba Juice and Bloomin Brands (company announcement).
Updated share repurchase activity, buying back about 1.1 million shares for $36.9 million between July 2 and November 5, 2025, and bringing total repurchases under the long running program to roughly 15.5 million shares for $581 million (company filing).
Issued fiscal 2025 guidance calling for approximately 2% comparable restaurant sales growth and restaurant level operating profit between $211 million and $219 million (corporate guidance).
Expanded its equity buyback authorization by $75 million in October 2025, increasing the total program size to $675 million (company filing).

Valuation Changes

The fair value estimate has remained unchanged at approximately $38.88 per share, indicating no material shift in intrinsic value assessment.
The discount rate has fallen slightly from about 10.04% to roughly 9.96%, reflecting a modest reduction in perceived risk or required return.
The revenue growth assumption is effectively unchanged, holding near 3.06% annually and signaling stable top line expectations.
The net profit margin has risen slightly from roughly 4.03% to about 4.10%, incorporating a small upgrade to long term profitability assumptions.
The future P/E multiple has fallen modestly from about 14.40x to roughly 14.09x, suggesting a slightly lower valuation multiple applied to forward earnings.

Menu innovation, digital initiatives, and omnichannel focus increase customer frequency and tap into evolving consumer trends, broadening revenue opportunities.
Operational efficiencies, technology upgrades, and strategic expansion efforts drive margin improvement, cost control, and long-term earnings growth.
Slow digital adoption, menu misalignment with health trends, high labor costs, cautious expansion, and rising competition all threaten BJ's long-term growth and profitability.

Catalysts

About BJ's Restaurants

Operates full-service restaurants in the United States.What are the underlying business or industry changes driving this perspective?

Continued improvement and innovation in platforms like the Pizookie Meal Deal and the upcoming relaunch of BJ's iconic pizza-tailored to quality, shareability, and consumer value-are driving higher guest frequency, new customer acquisition, and check growth, supporting future revenue expansion.
Enhanced focus on operational efficiencies via activity-based labor models, AI-driven forecasting, better staff retention, and technology upgrades (POS, reservation integrations) are yielding lower labor costs, higher net margins, and improved guest service-a foundation for sustained earnings growth.
Strategic investments in digital and off-premise initiatives, including friction reduction in ordering/fulfillment and optimized online menus, position BJ's to capture rising off-premise and omnichannel demand, tapping into a broader revenue base as consumer preferences shift.
Plans for long-term restaurant footprint expansion-emphasizing remodels and concentric growth in underpenetrated markets-enable leverage of brand awareness and fixed costs, supporting top-line growth and margin improvement in the years ahead.
Menu breadth and ongoing beverage/alcohol innovation (including non-alc and club concepts) align with health, customization, and experiential dining trends, increasing BJ's appeal to Millennials/Gen Z and supporting revenue growth via expanded occasions and check averages.

BJ's Restaurants Earnings and Revenue Growth

BJ's Restaurants Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming BJ's Restaurants's revenue will grow by 2.8% annually over the next 3 years.
Analysts assume that profit margins will increase from 2.0% today to 4.4% in 3 years time.
Analysts expect earnings to reach $66.0 million (and earnings per share of $3.12) by about September 2028, up from $27.5 million today.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 17.2x on those 2028 earnings, down from 26.4x today. This future PE is lower than the current PE for the US Hospitality industry at 23.9x.
Analysts expect the number of shares outstanding to decline by 3.03% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 10.29%, as per the Simply Wall St company report.

BJ's Restaurants Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

BJ's comparatively slow development and optimization of digital and off-premise ordering infrastructure could limit its competitiveness in capturing the sustained shift towards at-home dining and delivery, potentially capping long-term revenue growth from these channels.
The restaurant's core menu focus on pizzas, Pizookies, and comfort foods may be increasingly mismatched with evolving consumer preferences around health consciousness and plant-based eating, risking gradual erosion of customer demand and topline growth.
Persistently high labor costs and potential wage inflation remain an underlying risk to BJ's net margins, especially given its emphasis on in-restaurant guest experience and large-format, labor-intensive dine-in concepts, making margin gains difficult to sustain long-term.
The slow ramp and cautious approach to new unit openings-focusing remodels over rapid new restaurant expansion-may constrain higher revenue and earnings growth rates relative to peers aggressively capitalizing on favorable market footprints or newer concepts.
Intensifying industry competition from fast-casual chains, innovative independents, and value-focused restaurants, combined with rising commercial real estate costs and increasing regulatory burdens, could further pressure BJ's average unit volumes, pricing power, cost structure, and ultimately, overall profitability.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $42.333 for BJ's Restaurants based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $50.0, and the most bearish reporting a price target of just $37.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $1.5 billion, earnings will come to $66.0 million, and it would be trading on a PE ratio of 17.2x, assuming you use a discount rate of 10.3%.
Given the current share price of $32.81, the analyst price target of $42.33 is 22.5% higher.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Analyst Commentary Highlights Mixed Outlook and Lower Price Targets for BJ's Restaurants