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Assessing Brinker International (EAT) Valuation After Recent Share Price Momentum

Simply Wall St · 3d ago

Why Brinker International is on investors’ radar now

Brinker International (EAT) has caught investor attention after recent share price moves, with the stock showing double digit gains over the past 3 months and a 1 year total return above 10%.

See our latest analysis for Brinker International.

With the share price at $156.23 and a 90 day share price return of 25.55%, recent momentum has been strong, echoing a 1 year total shareholder return of 11.98% and a very large 3 year total shareholder return that suggests earlier investors have already seen substantial gains.

If Brinker International’s move has you considering where growth and ownership conviction might align, it could be worth scanning fast growing stocks with high insider ownership as a next step.

With Brinker International trading at $156.23, an intrinsic discount of 22.56% and a value score of 5, the real question is whether there is still a buying opportunity here or if the market is already pricing in future growth.

Most Popular Narrative: 6% Undervalued

With Brinker International last closing at $156.23 against a narrative fair value of $166.12, the story centers on steady growth and gradually improving profitability.

The company's disciplined capital allocation, stronger balance sheet (deleveraging to 1.7x lease-adjusted leverage), and commitment to remodeling and new unit growth provide increased flexibility to capitalize on suburban/urban development trends, fueling long-term unit growth and future revenue expansion.

Read the complete narrative.

Curious what earnings path and margin profile supports that valuation gap? The narrative leans on measured revenue expansion, firmer margins, and a future P/E that stays below current industry levels.

Result: Fair Value of $166.12 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, there are still pressure points to watch, including rising labor and commodity costs and the risk that dine-in-focused brands lose ground to off-premise rivals.

Find out about the key risks to this Brinker International narrative.

Build Your Own Brinker International Narrative

If you look at the same data and reach a different conclusion, or simply prefer to shape your own view, you can build a custom narrative in just a few minutes by starting with Do it your way.

A great starting point for your Brinker International research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.