uploads/2016/08/9.jpg

What Do Analysts Recommend for Wendy’s?

By

Updated

Analysts’ recommendations

As of August 1, Wendy’s (WEN) was trading at $9.73. Wendy’s share price may have already priced in the estimates we discussed earlier in this series. In this article, we’ll look at analysts’ recommendations and estimated price targets for the company over the next 12 months.

With the expectation of a decline in Wendy’s same-store sales growth, investors are skeptical about the company’s future earnings. This has led to a decline in its share price. However, analysts are expecting the share price to touch $11.7 in the next 12 months, which represents a return potential of 19.8%.

Article continues below advertisement

Michael W Gallo of CL King & Associates, who is the most optimistic about Wendy’s of all surveyed analysts, expects the share price to touch $14.5 in the next 12 months, which represents a return potential of 49%. On the lower side, Dennis Geiger of UBS expects the share price to decline by 7.5% to touch $9 in the next 12 months.

The 12-month price targets for Wendy’s peers are as follows:

  • Jack in the Box (JACK): $96.6 with a return potential of 6.5%
  • Restaurant Brands International (QSR): $45.6 with a return potential of 1.4%

Analyst recommendations

According to a Bloomberg consensus, of the ten analysts surveyed, 45.5% have “buy” recommendations for Wendy’s, 50% have “hold” recommendations, and 4.5% have “sell” recommendations. Wendy’s share price generally moves in tandem with analysts’ recommendations. As analysts raise their consensus target price, the price of the stock may also increase, and vice versa.

A share price that is lower than its target price doesn’t indicate an automatic “buy.” Before investing, investors should carefully analyze the various metrics we’ve discussed in this series.

Advertisement

More From Market Realist