Shares of Brinker International (EAT) have been strong performers lately, with the stock up 16.2% over the past month. The stock hit a new 52-week high of $181.72 in the previous session. Brinker International has gained 22.1% since the start of the year compared to the 0.3% gain for the Zacks Retail-Wholesale sector and the 2.7% return for the Zacks Retail - Restaurants industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on April 29, 2026, Brinker International reported EPS of $2.9 versus consensus estimate of $2.85.
For the current fiscal year, Brinker International is expected to post earnings of $12.42 per share on $5.81 in revenues. Meanwhile, for the next fiscal year, the company is expected to earn $13.43 per share on $6.11 in revenues. This represents a year-over-year change of 15.6% and 5.26%, respectively.
Valuation Metrics
While Brinker International has moved to its 52-week high in the recent past, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). The individual style scores for Value, Growth, Momentum and the combined VGM Score run from A through F. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Brinker International has a Value Score of B. The stock's Growth and Momentum Scores are A and F, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 14.1X current fiscal year EPS estimates, which is not in-line with the peer industry average of 20.3X. On a trailing cash flow basis, the stock currently trades at 12.6X versus its peer group's average of 10.8X. Additionally, the stock has a PEG ratio of 1.09. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Brinker International currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Brinker International passes the test. Thus, it seems as though Brinker International shares could have a bit more room to run in the near term.
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Brinker International, Inc. (EAT): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).