Portillo’s (NASDAQ:PTLO) Issues Earnings Results

Portillo’s (NASDAQ:PTLO) posted its earnings results on Wednesday. The company reported $0.09 EPS for the quarter, meeting analysts’ consensus estimates of $0.09, FiscalAI reports. Portillo’s had a return on equity of 3.17% and a net margin of 2.12%.The company had revenue of $198.95 million for the quarter, compared to the consensus estimate of $199.22 million. During the same quarter in the previous year, the business earned $0.12 earnings per share. The company’s revenue for the quarter 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, reaching $4.67. 1,320,631 shares of the stock were exchanged, compared to its average volume of 1,031,588. Portillo’s has a twelve month low of $3.78 and a twelve month high of $8.21. The business has a 50-day moving average of $4.46 and a two-hundred day moving average of $5.04. The company has a market capitalization of $354.03 million, a price-to-earnings ratio of 21.57, a PEG ratio of 0.84 and a beta of 1.56. The company has a quick ratio of 0.22, a current ratio of 0.26 and a debt-to-equity ratio of 0.47.

Analyst Upgrades and Downgrades

A number of equities analysts have recently weighed in on the company. Morgan Stanley cut their price objective on Portillo’s from $7.00 to $6.00 and set an “equal weight” rating for the company in a research report on Wednesday, May 6th. Weiss Ratings restated a “sell (d)” rating on shares of Portillo’s in a report on Monday. Stifel Nicolaus decreased their target price on shares of Portillo’s from $6.00 to $5.00 and set a “hold” rating on the stock in a research report on Wednesday, May 6th. Robert W. Baird set a $5.25 target price on shares of Portillo’s in a research note on Wednesday, May 6th. Finally, Piper Sandler dropped their price target on shares of Portillo’s from $8.00 to $6.00 and set an “overweight” rating for the company in a research report on Wednesday, May 6th. Two analysts have rated the stock with a Buy rating, ten have issued a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat, the stock presently has a consensus rating of “Hold” and a consensus target price of $5.92.

Insider Buying and Selling at Portillo’s

In other news, Director Eugene I. Lee, Jr. acquired 70,165 shares of the company’s stock in a transaction dated Monday, May 11th. The stock was acquired at an average cost of $4.28 per share, with a total value of $300,306.20. Following the completion of the purchase, the director owned 486,415 shares of the company’s stock, valued at $2,081,856.20. This represents a 16.86% increase in their position. The acquisition was disclosed in a document filed with the SEC, which is available at this link. Insiders own 6.34% of the company’s stock.

Hedge Funds Weigh In On Portillo’s

Several hedge funds have recently bought and sold shares of PTLO. Atom Investors LP purchased a new stake in Portillo’s during the fourth quarter worth about $115,000. &PARTNERS boosted its stake in shares of Portillo’s by 123.2% in the fourth quarter. &PARTNERS now owns 22,390 shares of the company’s stock valued at $98,000 after purchasing an additional 12,360 shares during the period. Tower Research Capital LLC TRC boosted its stake in shares of Portillo’s by 336.4% in the second quarter. Tower Research Capital LLC TRC now owns 8,135 shares of the company’s stock valued at $95,000 after purchasing an additional 6,271 shares during the period. Sherbrooke Park Advisers LLC purchased a new position in shares of Portillo’s in the third quarter valued at approximately $93,000. Finally, BNP Paribas Financial Markets grew its holdings in shares of Portillo’s by 119.9% in the third quarter. BNP Paribas Financial Markets now owns 11,931 shares of the company’s stock valued at $77,000 after purchasing an additional 6,505 shares in the last quarter. Institutional investors and hedge funds own 98.34% of the company’s stock.

About Portillo’s

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.