Portillo’s (NASDAQ:PTLO) Issues Earnings Results

Portillo’s (NASDAQ:PTLO) announced its earnings results on Wednesday. The company reported $0.09 earnings per share (EPS) for the quarter, hitting the consensus estimate of $0.09, FiscalAI reports. Portillo’s had a net margin of 2.12% and a return on equity of 3.17%. The company had revenue of $198.95 million for the quarter, compared to analysts’ expectations of $199.22 million. During the same quarter in the previous year, the company posted $0.12 EPS. The firm’s quarterly revenue was up 5.6% on a year-over-year basis.

Here are the key takeaways from Portillo’s’ conference call:

• Adjusted EBITDA guidance was reduced to $92 million-$96 million, reflecting weaker-than-expected performance at newer, non-comparable restaurants—particularly in Texas and Arizona—along with elevated commodity costs.
• Q2 revenue increased 5.6% to $199 million as new restaurants contributed growth, but same-restaurant sales declined 1.2% on a 3.4% transaction decline; restaurant-level EBITDA margin fell 190 basis points to 21.7% due primarily to food inflation and newer-unit underperformance.
• Management expects approximately $10 million-$15 million in annualized run-rate savings from corporate restructuring, supply-chain efficiencies, and indirect-spend reductions, with some benefits beginning in the third quarter.
• Same-restaurant sales were slightly positive early in Q3, while beef costs are largely protected by hedges—85% for Q3 and Q4—and management plans to use improving free cash flow to pay down debt and reduce revolver borrowings.
• Portillo’s is reassessing its development model after identifying excessive cannibalization, high build costs, and weak returns in parts of Texas; management expects four to six openings in 2027 and plans to launch a smaller, more efficient prototype in 2028.

Portillo’s Trading Up 3.1%

NASDAQ:PTLO traded up $0.14 during trading hours on Wednesday, hitting $4.67. The company had a trading volume of 1,320,631 shares, compared to its average volume of 1,031,588. Portillo’s has a 1 year low of $3.78 and a 1 year high of $8.21. The company has a market cap of $354.03 million, a P/E ratio of 21.57, a P/E/G ratio of 0.84 and a beta of 1.56. The company has a 50-day moving average of $4.46 and a 200 day moving average of $5.04. The company has a current ratio of 0.26, a quick ratio of 0.22 and a debt-to-equity ratio of 0.47.

Analyst Upgrades and Downgrades

A number of equities research analysts have recently commented on the stock. Stifel Nicolaus reduced their target price on shares of Portillo’s from $6.00 to $5.00 and set a “hold” rating for the company in a research report on Wednesday, May 6th. Guggenheim lowered shares of Portillo’s from a “buy” rating to a “neutral” rating in a research report on Thursday, May 7th. Weiss Ratings reaffirmed a “sell (d)” rating on shares of Portillo’s in a research note on Monday. Stephens set a $5.00 price objective on shares of Portillo’s in a report on Tuesday, July 21st. Finally, Morgan Stanley decreased their target price on shares of Portillo’s from $7.00 to $6.00 and set an “equal weight” rating on the stock in a research note on Wednesday, May 6th. Two research analysts have rated the stock with a Buy rating, ten have given a Hold rating and one has given a Sell rating to the company. According to MarketBeat.com, the company has a consensus rating of “Hold” and an average price target of $5.92.

Insider Activity at Portillo’s

In other news, Director Eugene I. Lee, Jr. purchased 70,165 shares of the stock in a transaction dated Monday, May 11th. The shares were purchased at an average price of $4.28 per share, with a total value of $300,306.20. Following the transaction, the director owned 486,415 shares in the company, valued at $2,081,856.20. The trade was a 16.86% increase in their position. The acquisition was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this hyperlink. 6.34% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Portillo’s

Institutional investors have recently bought and sold shares of the company. Millennium Management LLC acquired a new position in Portillo’s in the 4th quarter valued at about $10,350,000. Alliancebernstein L.P. increased its holdings in shares of Portillo’s by 16.8% during the 2nd quarter. Alliancebernstein L.P. now owns 5,777,921 shares of the company’s stock worth $67,428,000 after buying an additional 830,460 shares during the last quarter. Renaissance Technologies LLC increased its holdings in shares of Portillo’s by 133.5% during the 4th quarter. Renaissance Technologies LLC now owns 1,204,897 shares of the company’s stock worth $5,470,000 after buying an additional 688,800 shares during the last quarter. Bridgeway Capital Management LLC purchased a new stake in shares of Portillo’s during the 3rd quarter valued at approximately $2,609,000. Finally, Orbis Allan Gray Ltd raised its position in shares of Portillo’s by 6.4% during the 2nd quarter. Orbis Allan Gray Ltd now owns 6,358,093 shares of the company’s stock valued at $74,199,000 after buying an additional 384,455 shares during the period. 98.34% of the stock is owned by hedge funds and other institutional investors.

Portillo’s Company Profile

Portillo’s, Inc operates a fast?casual restaurant chain best known for its Chicago?style menu, featuring Italian beef sandwiches, Chicago?style hot dogs, char?grilled burgers, salads, crinkle?cut fries and hand?spun milkshakes. In addition to its signature sandwiches and dogs, the company offers a selection of desserts—including its famous chocolate cake and frozen custard—as well as catering services designed to bring its Midwestern flavors to corporate and social events.

The company was founded in 1963 by Dick Portillo, who opened the first Portillo’s in Villa Park, Illinois.