El Pollo LoCo (LOCO)
NASDAQ:LOCO
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El Pollo LoCo
(NASDAQ:LOCO)
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Rating:70Outperform
Price Target:
$15.50
▲(11.11% Upside)
Action:Reiterated
Date:05/30/26
The score is driven primarily by steady financial performance with improved leverage but weaker cash conversion and some margin pressure. Technicals are moderately bullish with price above key moving averages, and the earnings call added support via raised guidance and strong operating momentum, partially tempered by liquidity/capex and inflation risks. Valuation is reasonable on P/E, with no dividend yield data to enhance the profile.
Positive Factors
Asset-light franchise model
El Pollo Loco's mix of company-operated and franchised restaurants creates recurring royalty and fee revenue while limiting corporate capital intensity. That asset-light element supports scalable unit growth, steadier cash-like revenue streams, and lower incremental capex per new system sale over a multi-month horizon.
Negative Factors
Tight liquidity vs. planned capex
Very low cash holdings relative to outstanding debt combined with nearly $40M of planned annual capex create a structural liquidity mismatch risk. Over the next several months management may need to draw on credit, issue debt, or reduce discretionary investment, constraining financial flexibility during expansion.
Read all positive and negative factors
Positive Factors
Negative Factors
Asset-light franchise model
El Pollo Loco's mix of company-operated and franchised restaurants creates recurring royalty and fee revenue while limiting corporate capital intensity. That asset-light element supports scalable unit growth, steadier cash-like revenue streams, and lower incremental capex per new system sale over a multi-month horizon.
Read all positive factors
El Pollo LoCo (LOCO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$420.89M
Dividend YieldN/A
Average Volume (3M)242.50K
Price to Earnings (P/E)13.9
Beta (1Y)0.86
Revenue Growth4.42%
EPS Growth16.38%
CountryUS
Employees4,000
SectorConsumer Cyclical
Sector Strength84
IndustryRestaurants
Share Statistics
EPS (TTM)0.99
Shares Outstanding30,455,297
10 Day Avg. Volume278,012
30 Day Avg. Volume242,502
Financial Highlights & Ratios
PEG Ratio1.99
Price to Book (P/B)1.05
Price to Sales (P/S)0.62
P/FCF Ratio12.03
Enterprise Value/Market Cap1.62
Enterprise Value/Revenue1.37
Enterprise Value/Gross Profit5.49
Enterprise Value/Ebitda11.02
Forecast
1Y Price Target
$18.50Price Target Upside32.62% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
EPS Forecast (FY)0.97
Revenue Forecast (FY)$503.76M
El Pollo LoCo Business Overview & Revenue Model
Company Description
El Pollo Loco Holdings, Inc., primarily operating through its El Pollo Loco, Inc. subsidiary, is engaged in the development, franchising, licensing, and direct management of quick-service restaurants under the El Pollo Loco brand. By May 4, 2022, ...
How the Company Makes Money
The company makes money primarily from (1) sales at company-operated restaurants and (2) revenue derived from franchised and licensed restaurants. For company-operated locations, revenue is generated from direct-to-consumer food and beverage sales...
El Pollo LoCo Earnings Call Summary
Earnings Call Date:May 07, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 30, 2026
Earnings Call Sentiment Positive
The call conveyed clear operational momentum: strong comparable sales (+5.8% in Q1), meaningful restaurant-level margin expansion (+320 bps to 19.2%), higher profitability (adjusted EBITDA +31%) and successful product innovation and loyalty engagement. Management raised full-year comps and EBITDA guidance and outlined an aggressive unit growth plan. Key risks include a modest near-term liquidity position (low cash vs. outstanding debt and elevated planned capex), a timing-related decline in franchise revenue, ongoing commodity/wage inflation and continued focus needed on speed-of-service. Overall, positive fundamentals and upgraded guidance outweigh the highlighted challenges.Positive Updates
System-Wide Same-Store Sales Growth
System-wide same-store sales increased 5.8% in Q1 2026, with system-wide traffic turning positive up 0.6% and company-operated comparable store sales up 5.4%.
Negative Updates
Franchise Revenue Decline (Timing/One-Time Item)
Franchise revenue declined 8.8% to $12.0M, primarily due to $1.9M of franchise IT pass-through revenue in the prior-year quarter related to the new POS rollout (timing-related decrease).
Read all updates
Q1-2026 Updates
Positive
Negative
System-Wide Same-Store Sales Growth
System-wide same-store sales increased 5.8% in Q1 2026, with system-wide traffic turning positive up 0.6% and company-operated comparable store sales up 5.4%.
Read all positive updates
Company Guidance
Management increased 2026 guidance, raising system‑wide comparable store sales to 2.0%–4.0% for the year (Q2 comps expected ~3%–4%), boosting adjusted EBITDA to $67.5–$69.5 million, and maintaining openings of at least 3–4 company and 15–16 franchise restaurants; full‑year restaurant‑level margin is now expected at 18.25%–18.75% (Q2 margin 19.0%–19.5%; long‑term target 18%–20%), capital spending $37–$40 million, G&A $52–$54 million (including ≈$6.5 million stock compensation), estimated effective tax rate ~29%–29.5% (pre‑discrete), depreciation & amortization $18.5–$19.0 million, and full‑year commodity and wage inflation each roughly 1.5%–2.5%.El Pollo LoCo Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
67
Positive
Cash Flow
63
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 497.05M | 490.05M | 473.01M | 468.66M | 469.96M | 454.36M |
| Gross Profit | 124.23M | 140.35M | 103.52M | 93.37M | 83.70M | 99.27M |
| EBITDA | 61.88M | 58.42M | 56.91M | 55.09M | 44.97M | 56.45M |
| Net Income | 29.16M | 26.49M | 25.68M | 25.55M | 20.80M | 29.12M |
Balance Sheet | ||||||
| Total Assets | 609.12M | 606.65M | 592.01M | 592.30M | 597.22M | 613.79M |
| Cash, Cash Equivalents and Short-Term Investments | 3.90M | 6.23M | 2.48M | 7.29M | 20.49M | 30.05M |
| Total Debt | 232.97M | 239.57M | 263.02M | 273.33M | 252.88M | 233.47M |
| Total Liabilities | 306.62M | 315.57M | 331.35M | 341.61M | 316.07M | 303.16M |
| Stockholders Equity | 302.50M | 291.08M | 260.67M | 250.70M | 281.15M | 310.62M |
Cash Flow | ||||||
| Free Cash Flow | 26.86M | 25.44M | 27.70M | 19.36M | 18.63M | 35.06M |
| Operating Cash Flow | 56.35M | 48.08M | 46.78M | 40.69M | 38.55M | 52.10M |
| Investing Cash Flow | -29.49M | -22.64M | -18.94M | -13.45M | -18.91M | -12.48M |
| Financing Cash Flow | -27.28M | -21.70M | -32.65M | -40.45M | -29.19M | -22.79M |
El Pollo LoCo Technical Analysis
Neutral
13.95
Price Trends
13.83
Negative
12.59
Positive
11.47
Positive
Market Momentum
0.13
Positive
48.98
Neutral
6.27
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOCO, the sentiment is Neutral. The current price of 13.95 is above the 20-day moving average (MA) of 13.92, above the 50-day MA of 13.83, and above the 200-day MA of 11.47, indicating a neutral trend. The MACD of 0.13 indicates Positive momentum. The RSI at 48.98 is Neutral, neither overbought nor oversold. The STOCH value of 6.27 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for LOCO.
El Pollo LoCo Risk Analysis
El Pollo LoCo disclosed 35 risk factors in its most recent earnings report. El Pollo LoCo reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
El Pollo LoCo Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $420.89M | 13.94 | 10.14% | ― | 4.42% | 16.38% | |
67 Neutral | $3.29B | 18.67 | 38.34% | 2.11% | 5.14% | 8.17% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | $1.28B | 7.44 | 150.73% | 8.15% | -1.84% | -17.48% | |
50 Neutral | $1.05B | 36.81 | -6.47% | 4.72% | -2.41% | -64.77% | |
46 Neutral | $215.91M | 6.10 | -3.80% | 9.34% | -17.16% | ― |
* Consumer Cyclical Sector Average
LOCO
El Pollo LoCo
13.99
3.11
28.58%
JACK
Jack In The Box
11.58
-9.99
-46.31%
PZZA
Papa John's International
31.65
-16.53
-34.31%
CAKE
Cheesecake Factory
67.22
9.53
16.53%
WEN
Wendy's
6.74
-3.98
-37.12%
El Pollo LoCo Corporate Events
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
El Pollo Loco Shareholders Approve Directors and Pay Policies
Positive
May 29, 2026
On May 26, 2026, El Pollo Loco held its annual meeting of stockholders, where shareholders elected two Class III directors to serve until the 2027 annual meeting and ratified BDO USA, P.C. as the company’s independent registered public accou...
Business Operations and StrategyStock Buyback
El Pollo Loco Announces $40 Million Share Repurchase Program
Positive
May 28, 2026
On May 28, 2026, El Pollo Loco Holdings, Inc. announced that its Board of Directors approved a share repurchase program authorizing the company to buy back up to $40 million of its common stock. The authorization, which has an open-ended term, all...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.