Texas Roadhouse (TXRH)
NASDAQConsumer DiscretionaryRestaurantsSnapshot 2026-09-04
$189.56+0.26%
Close 2026-09-04 · 1-day change
NASDAQConsumer DiscretionaryRestaurantsSnapshot 2026-09-04
Warn: Primary pillar under pressure — Operating income growth via cost management: Operating margin 14.0% vs target of growth; Q2 EPS miss -2.6%.
Texas Roadhouse grows sales about 12% a year. Profit rises with better cost control. Dividends increased to $0.75 per share. New locations and pricing power support growth.
Menu changes may hurt customer satisfaction and sales. Rising beef prices could raise costs more than revenue. The stock trades expensive with a PE near 30.
The price is about 33% above our fair value near $140. Analysts expect about 12% revenue growth, which aligns with management's recent results. Our fair value is below the Street median, reflecting caution on valuation.
Breaks if: Dividend per share falls below $0.68 next year
Breaks if: Operating income fails to grow or declines next year
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a durable compounder with a focus on growth through sales and store expansion. The current thesis state is intact, despite recent earnings misses, as the company maintains strong financial performance relative to its industry.
The market seems to have priced in a stretched valuation compared to peers, reflecting a durable premium. There is a modest expectations gap, suggesting that investors are anticipating continued strong performance.
Management has shown robust earnings quality and has made progress in maintaining margins despite inflation pressures. However, recent volatility in management and a history of earnings misses could pose risks to future performance.
The thesis hinges on management's ability to drive sales growth and maintain margins while navigating inflation. Additionally, the performance of sector bellwethers and broader economic conditions will be crucial in shaping future outcomes.
The most important moves since the prior daily snapshot.
The recent news cuts both ways. It is challenged by the latest earnings miss. It is supported by drive comparable restaurant sales growth and store expansion.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Enhance operating income through cost management and efficiency improvements.
Breaks if: YoY revenue growth falls below 7% next year
Focus on increasing revenue through menu pricing actions and store week growth.
Over the next 1 to 3 years, TXRH's performance will depend on effective management execution and external economic factors. Not investment advice.