Can Brinker International (EAT) Turn Chili’s Momentum Into a Sustained Turnaround Without Price Hikes?

• Brinker International recently reported a strong quarter, with revenue rising 18.5% year on year and Chili’s same-store sales beating analyst expectations, even as full-year revenue guidance came in slightly below forecasts.
• The combination of robust near-term performance and more cautious outlook highlights Brinker's challenge of boosting traffic and margins without relying on significant pricing power amid moderating demand.
• Now we’ll examine how this strong but cautiously framed quarter, especially Chili’s outperformance, might influence Brinker's ongoing turnaround investment narrative.

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Brinker International Investment Narrative Recap

To own Brinker today, you need to believe its Chili’s led turnaround can convert recent sales strength into sustainable traffic and margin gains, despite limited pricing power and moderating demand. The latest quarter’s 18.5% revenue growth and same store sales beat support that thesis, but the slightly softer full year revenue guidance underlines the core near term risk that cost inflation and shifting guest preferences could pressure profitability if traffic momentum cools.

Among recent developments, Brinker's reaffirmed FY2026 revenue outlook of US$5.60 to US$5.70 billion and non GAAP EPS guidance of US$9.90 to US$10.50 are especially relevant here, as they frame Chili’s recent outperformance within a measured multi year recovery path. For investors focused on catalysts, this guidance ties the near term upside from operational and digital initiatives to a more gradual earnings ramp that still needs to contend with wage, food, and off premise competition pressures.

But while Chili’s is posting strong comps, investors should be aware that...

Read the full narrative on Brinker International (it's free!)

Brinker International's narrative projects $6.2 billion revenue and $562.8 million earnings by 2028.

Uncover how Brinker International's forecasts yield a $162.82 fair value, a 14% upside to its current price.

Exploring Other Perspectives

Two Simply Wall St Community fair value estimates for Brinker span roughly US$162.82 to US$201.28, underscoring how far opinions can spread. Against that backdrop, the company’s limited pricing power and exposure to labor and commodity costs give you a clear reason to compare several viewpoints before deciding how resilient you think earnings can be.

Explore 2 other fair value estimates on Brinker International - why the stock might be worth just $162.82!

Build Your Own Brinker International Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Brinker International research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Brinker International research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Brinker International's overall financial health at a glance.

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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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