Potbelly Corporation PBPB provided second-quarter 2023-to-date business update that reflects preliminary same-store sales and weekly average unit volumes (AUV). The numbers exceeded the company’s guidance.
Per the report, Potbelly’s quarter to date same-store sales grew 14.4%, exceeding the expected range of 10-12%. Double-digit growth was witnessed across store types along with dine-in and digital. Also, weekly AUV reached $26,160, up from the expected range of $25,250-$25,750 for the second quarter.
The impressive growth trend of Potbelly was backed by solid customer traffic, thanks to its focus on menu innovation, operational efficiencies and marketing initiatives. Improvements on these fronts reflect the company’s consistent implementation of the Five-Pillar strategy, which forms the core of its ongoing growth momentum.
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Shares of PBPB rose 3.3% during the trading session on Jun 6. The stock has surged 56.8% in the year-to-date period compared with the Zacks Retail - Restaurants industry’s growth of 9.5%.
Potbelly’s Five-Pillar Strategy
Potbelly’s growth has gained momentum since it implemented the Five-Pillar Strategy in early 2021. The company came up with this strategy to curb the negative impacts of the coronavirus pandemic on its growth and to be able to deliver services with utmost efficiency.
The Five-Pillar Strategy focuses on the company providing a variety of menu items at a great value, positive outlook of the staff along with creating customer value. It also looks to ensure the best customer experiences to drive solid traffic growth, digitization and franchise-focused development strategies adds to it.
In first-quarter fiscal 2023, the Five-Pillar Strategy drove consistent growth in customer traffic, same-store sales and franchising momentum. In the said quarter, same-store sales grew 22.2%, with average unit volumes of $23,881.
Zacks Rank & Key Picks
Potbelly currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks from the Zacks Retail-Wholesale sector include Yum China Holdings, Inc. YUMC, Chipotle Mexican Grill, Inc. CMG and Chuy's Holdings, Inc. CHUY.
Yum China currently sports a Zacks Rank #1. YUMC has a trailing four-quarter earnings surprise of 301.6%, on average. Shares of the company have gained 27.1% in the past year.
The Zacks Consensus Estimate for YUMC’s 2023 sales and EPS suggests growth of 19.7% and 89.5%, respectively, from the year-ago period’s levels.
Chipotle sports a Zacks Rank #1. CMG has a trailing four-quarter earnings surprise of 4.7%, on average. The shares of the company have risen 49.9% in the past year.
The Zacks Consensus Estimate for CMG’s 2023 sales and EPS suggests growth of 14% and 33.9%, respectively, from the year-ago period’s levels.
Chuy's Holdings carries a Zacks Rank #2 (Buy). CHUY has a trailing four-quarter earnings surprise of 23.4%, on average. Shares of the company have increased 80.9% in the past year.
The Zacks Consensus Estimate for CHUY’s 2023 sales and EPS suggests growth of 9.9% and 24.8%, respectively, from the year-ago period’s levels.
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