JPMorgan upgrades Wendy’s on ‘value-oriented opportunity’

JPMorgan upgraded Wendy’s (WEN) to Overweight from Neutral with a price target of $15, down from $17. The current share price provides a “value-oriented opportunity,” the analyst tells investors in a research note. The firm sees “significant upside” to Wendy’s equity value with a 6%-7% free cash flow yield potentially going to 8.5%. Wendy’s significantly de-risked the achievement of near-term comps expectations and has an opportunity for longer term development, especially in “underpenetrated” international markets, contends JPMorgan. The firm sees a “healthy’ free cash flow growth profile through fiscal 2028 for Wendy’s as store economics stabilize and start to improve.