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BofA analysts told investors in a note that the company is “spreading its wings,” but its long-term targets are conservative.
“In the mature US restaurant industry, the LSR chicken segment is the rare secular growth category. Despite being the second-biggest category in limited service – $41 bb in F22, behind only burgers at $100 bb – its 12% 5-year CAGR has outpaced every other segment,” the analysts explained. ” WING should continue to outpace the segment.”
“We think the company can build on the strength of its product and operating model with targeted sales drivers to generate outsized growth,” they added.
BofA sees opportunities for WING to bolster traffic through always-on advertising, boosting non-wing sales, and leveraging digital engagement, while they also anticipate continued strong value vs. hamburger chains as commodity prices diverge.
The analysts stated that WING has “industry-leading unit economics” and an attractive valuation for growth.
