BJ's Restaurants, Inc. Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

The full-year results for BJ's Restaurants, Inc. (NASDAQ:BJRI) were released last week, making it a good time to revisit its performance. The result was positive overall - although revenues of US$1.3b were in line with what the analysts predicted, BJ's Restaurants surprised by delivering a statutory profit of US$0.82 per share, modestly greater than expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for BJ's Restaurants

Taking into account the latest results, the consensus forecast from BJ's Restaurants' ten analysts is for revenues of US$1.36b in 2024. This reflects a reasonable 2.1% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 53% to US$1.29. Before this earnings report, the analysts had been forecasting revenues of US$1.40b and earnings per share (EPS) of US$1.25 in 2024. If anything, the analysts look to have become slightly more optimistic overall; while they decreased their revenue forecasts, EPS predictions increased and ultimately earnings are more important.

The consensus has made no major changes to the price target of US$36.70, suggesting the forecast improvement in earnings is expected to offset the decline in revenues next year. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic BJ's Restaurants analyst has a price target of US$42.00 per share, while the most pessimistic values it at US$24.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the BJ's Restaurants' past performance and to peers in the same industry. It's pretty clear that there is an expectation that BJ's Restaurants' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 2.1% growth on an annualised basis. This is compared to a historical growth rate of 5.2% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.8% per year. Factoring in the forecast slowdown in growth, it seems obvious that BJ's Restaurants is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards BJ's Restaurants following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on BJ's Restaurants. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple BJ's Restaurants analysts - going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for BJ's Restaurants (of which 1 is a bit unpleasant!) you should know about.

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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.