Wendy’s, the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Rahul Krotthapalli from J.P. Morgan maintained a Buy rating on the stock and has a $13.00 price target.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Rahul Krotthapalli has given his Buy rating due to a combination of factors including the stabilization and potential improvement in Wendy’s store economics, which are supported by attractive free cash flow yields. Despite a challenging outlook and recent performance, the company is seen as a value-oriented opportunity with projected free cash flow yields of 6.6% for fiscal year 2026 and 8.4% for fiscal year 2027.
The decision to exclude company-funded franchisee new unit development from future plans is expected to maintain the estimated free cash flow intact. Additionally, the valuation of Wendy’s shares at a 6.0% free cash flow yield, compared to a previous 5.25%, reflects a cautious approach to the risk of execution. The focus on reducing capital intensity and reallocating funds for faster deleveraging or shareholder returns is also a key consideration in the Buy rating.
In another report released on August 8, Piper Sandler also maintained a Buy rating on the stock with a $13.00 price target.
Based on the recent corporate insider activity of 61 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of WEN in relation to earlier this year.