BJ’s Restaurants (BJRI) has received a new Hold rating, initiated by Mizuho Securities analyst, .
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Mizuho Securities has given its Hold rating due to a combination of factors impacting BJ’s Restaurants. The company has been undergoing a strategic shift under new leadership, focusing on value and core items like pizza and beer. While the introduction of the $13 Pizookie Meal has led to positive traffic trends, there are concerns about the sustainability of this growth, particularly as the company approaches a critical period for maintaining momentum.
Despite optimism around the upcoming pizza relaunch, there is uncertainty regarding BJ’s ability to achieve sustained same-store sales growth, which is crucial for long-term financial performance. The lack of innovation in value offerings and less effective marketing efforts have also been noted as potential risks. Additionally, the company’s unit growth prospects are limited due to low cash-on-cash returns, and while there is no immediate balance sheet risk, the overall visibility into future growth remains unclear. Consequently, Mizuho Securities has set a price target of $32, reflecting these uncertainties and the current market conditions.
In another report released on October 16, Citi also maintained a Hold rating on the stock with a $38.00 price target.