Yahoo Finance Noodles & Company (NDLS), DND Group Partner to Expand in Oregon
With the aim of further growth in the Pacific Northwest market, Noodles & Company NDLS entered into a multi-unit franchise agreement with DND Group Inc. This agreement encompasses the immediate acquisition of six restaurant locations and the opening of a total of 10 new restaurants in the Portland, OR area.
The franchise agreement for the six restaurant locations is an exclusive development agreement in a few of the most populous cities in Oregon, comprising Portland, Eugene, Bend and Yakima-Kennewick-Pasco. The first location is slated to open in 2025.
Leveraging the remarkable history of exceptional operations of the DND Group, NDLS is well-positioned to expand its presence throughout the United States.
Shares of NDLS lost 7.8% during the trading hours but grew 3.2% in the after-hours trading session on Apr 17.
Expansion Initiatives Bode Well
Noodles & Company’s primary growth strategy focuses on expansion through new restaurant openings. The company continues to expand its presence across the United States through franchise agreements, specially in southern and southeastern markets. The primary goal of NDLS in 2024 is to grow its franchise presence mainly in certain markets, including Alabama, Florida, Georgia, Texas and Oklahoma.
During fiscal 2023, NDLS opened 18 company-owned restaurants. As of Jan 2, 2024, the company had 470 restaurants system-wide, comprising 380 company-owned restaurants and 90 franchise restaurants.
For fiscal 2024, the company expects to open 10-12 company-owned restaurants and up to three franchise-owned restaurants.
Price Performance
Shares of this national fast-casual restaurant chain have dwindled 60.3% in the year-to-date period compared with the Retail - Restaurants industry’s 1.5% decline. The decrease in comparable restaurant sales due to lower guest traffic has been hurting the company’s performance. Also, increased costs and expenses are added concerns.
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Nonetheless, Noodles & Company’s expansion initiatives, digital capabilities and focus on menu transformation are likely to aid in kickstarting its growth momentum. For fiscal 2024, the company expects comparable restaurant sales growth to range between flat and 3% growth year over year.
Zacks Rank & Key Picks
Noodles & Company carries a Zacks Rank #5 (Strong Sell).
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ANF has a trailing four-quarter earnings surprise of 715.6%, on average. The stock has surged 360% in the past year. The Zacks Consensus Estimate for ANF’s fiscal 2024 sales and earnings per share (EPS) suggests growth of 5.6% and 19.1%, respectively, from the year-ago period’s levels.
Burlington Stores, Inc. BURL currently sports a Zacks Rank of 1. BURL has a trailing four-quarter earnings surprise of 10.1%, on average. The stock has dwindled 4.4% in the past year.
The Zacks Consensus Estimate for BURL’s fiscal 2024 sales and EPS indicates a 10.2% and a 22.3% rise, respectively, from the year-ago period’s levels.
The Gap, Inc. GPS currently sports a Zacks Rank of 1. GPS has a trailing four-quarter earnings surprise of 180.9%, on average. The stock has hiked 119.5% in the past year.
The Zacks Consensus Estimate for GPS’ fiscal 2024 sales and EPS suggests a decline of 0.3% and 4.9%, respectively, from the year-ago period’s levels.
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