In a report released yesterday, Sara Senatore from Bank of America Securities reiterated a Sell rating on Bloomin’ Brands (BLMN – Research Report), with a price target of $8.00.
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Sara Senatore’s rating is based on a combination of factors including Bloomin’ Brands’ recent financial performance and future outlook. The company reported better-than-expected revenue, primarily driven by its major brand, Outback, and other brands like Carrabba’s and Flemings. However, despite these revenue beats, the overall traffic remained negative, with the average check size accounting for the growth, indicating reliance on pricing rather than increased customer visits.
Additionally, Bloomin’ Brands faced higher-than-anticipated costs in goods and labor, which negatively impacted its restaurant-level margins. The company’s guidance for the second quarter also fell short of consensus expectations, suggesting continued challenges ahead. While the full-year guidance remains unchanged, the anticipated initiatives to boost traffic have not yet materialized, leading to a cautious outlook. These elements combined to support Sara Senatore’s Sell rating for the stock.
BLMN’s price has also changed dramatically for the past six months – from $16.780 to $7.260, which is a -56.73% drop .