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How Do Brinker’s Same-Store Sales Compare to Its Peers?

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Same-store sales growth for Brinker’s peers

In the previous parts of this series, we looked at the average check at Brinker International’s (EAT) concept restaurants Chili’s and Maggiano’s Little Italy. We also compared those averages to their peers.

We know that average check is just one side of the story about what customers spend. It’s also important to see how these restaurants’ peers have performed in same-store peers over the last year.

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Brinker International’s comparable sales

The above graph shows same-store sales growth in 2014 for Brinker’s restaurants and their peers. We can see that not many of those restaurants have a robust performance when compared to the 17% level of fast casual concept restaurants such as Chipotle Mexican Grill (CMG).

LongHorn, under the umbrella of Darden Restaurants (DRI), had a negative 5% same-store sales. Outback, under the umbrella of Bloomin’ Brands (BLMN), and Texas Roadhouse (TXRH) had a better 2014. Bloomin’ Brands’ Carrabba’s Italian Grill had negative same-store sales during the year.

Some of these stocks are also part of the Consumer Discretionary Select Sector SPDR (XLY), which holds about 10% of restaurant stocks.

Overall slump in casual dining restaurants

Casual dining restaurants are facing a tough time in the United States as they make efforts to change their image. The changes include everything from menus to technology use in order to increase efficiency.

Brinker International (EAT) has introduced new items on its Chili’s menu, including Fresh Mex and light, or lower calorie, items. It also introduced a tabletop ordering device, which we’ll look at in the later parts of this series.

Restaurants are also reimaging their stores to appeal to more customers. McDonald’s (MCD) and Burger King (QSR) have been reimaging their stores, and Brinker International has reimaged 80% of Chili’s. It’s yet to be seen how effective this strategy will be for Brinker’s same-store sales growth, which is still below 1% in the past two years.

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