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Noodles (NASDAQ:NDLS) & Company fell to a new all-time low in Tuesday afternoon trading as sentiment continues to fade on the restaurant stock. Shares were down 10.54% at 1:45 p.m. and are more than 58% lower on a year-to-date basis. A recent track record of soft revenue growth and fewer store openings have contributed to the sell-off.
For Q1, analysts forecast revenue of $121.8M for Noodles (NDLS) and EPS of -$0.17. The fast-casual restaurant company has reported an EPS loss in three of its last four quarters.
During Noodles' (NDLS) last earnings call (transcript), management conceded that the chain's menu looks dated compared to newer fast-casual competitors. "While we still offer familiar and comforting dishes that many of our existing guests love, we are not currently a compelling alternative for lapsed guests or for new guests," noted CEO Drew Madsen. "We are in the process of changing that as we use the contemporary comfort kitchen framework to transform our menu," he added.
On Wall Street, Jefferies still has a Buy rating on Noodles (NDLS). Analyst Andy Barish recently pointed to a favorable risk-reward profile on the restaurant name and thinks the new management is taking a prudent approach to unit growth as it works to execute the revamped strategic plan. Barish's long-term view is that Noodles (NDLS) still has the potential for sustained positive same-store sales starting in the second half of 2024 and that has shown it is well-positioned to become a leader in off-premise/digital.
Noodles (NDLS) has the third-worst 52-week share price performance of the 53 stocks in the restaurant sector.