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GEN Restaurant Group, Inc. Class A (GENK)
:GENK
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GEN Restaurant Group, Inc. Class A (GENK) AI Stock Analysis

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GENK

GEN Restaurant Group, Inc. Class A

(NASDAQ:GENK)

Rating:46Neutral
Price Target:
$3.50
▲(12.54% Upside)
GEN Restaurant Group, Inc. Class A faces significant financial and operational challenges, reflected in its low financial performance score. While there are positive signs in terms of expansion and product development, the technical indicators and valuation suggest caution. The special dividend and analyst rating provide some optimism, but the overall risk profile remains high.

GEN Restaurant Group, Inc. Class A (GENK) vs. SPDR S&P 500 ETF (SPY)

GEN Restaurant Group, Inc. Class A Business Overview & Revenue Model

Company DescriptionGEN Restaurant Group, Inc. operates restaurants in California, Arizona, Hawaii, Nevada, New York, and Texas. Its restaurants specialize in various flavored meats for Korean barbeque. The company was founded in 2011 and is based in Cerritos, California.
How the Company Makes MoneyGEN Restaurant Group, Inc. primarily generates revenue through the operation of its Korean BBQ restaurants. The company's revenue model is based on direct sales from dining experiences provided at its locations. Customers pay for a combination of food and beverages, including an all-you-can-eat option that is popular in Korean BBQ settings. The company may also explore additional revenue streams such as catering services and branded merchandise sales. Key factors contributing to its earnings include strategic location selection, effective marketing campaigns, and maintaining a high standard of food quality and customer service. Partnerships with suppliers to source quality ingredients at competitive prices also play a role in optimizing operational costs and enhancing profitability.

GEN Restaurant Group, Inc. Class A Earnings Call Summary

Earnings Call Date:Aug 06, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Nov 18, 2025
Earnings Call Sentiment Neutral
The earnings call reflected both positive and negative aspects. While there were significant advancements in new store openings, international expansion, and improved labor efficiencies, these were offset by challenges such as same-store sales decline, increased operating costs, and a net loss before income taxes.
Q2-2025 Updates
Positive Updates
New Store Openings and International Expansion
GEN Restaurant Group opened 7 new restaurants in the first half of 2025, including its first international expansion in South Korea. Plans are in place to open more restaurants in South Korea in the third quarter of 2025.
Strong AUV Revenue
Average Unit Volume (AUV) revenue is $5.3 million per restaurant, a high level in the casual dining space, driving strong margins and cash flow.
Efficient Payback Period
The company is on track for a 2.3-year payback period for new stores opened in 2024, allowing expansion with limited debt.
Gift Card and Product Line Expansion
GEN expanded gift card sales to Sam's Club locations and is developing additional product lines, including packaged meats and sauces, to be sold through various channels.
Improved Labor Efficiencies
Payroll and benefits as a percentage of sales decreased by 29 basis points year-over-year and 163 basis points from Q1 2025 due to rolled out labor efficiencies.
Negative Updates
Same-Store Sales Decline
A sharp downturn in restaurant customer traffic was observed in April, resulting in a drop in same-store sales, influenced by global tariffs and immigration policies.
Increased Operating Costs
Cost of goods sold increased by 97 basis points to 33.8% due to inflationary pressures and the operation of more new restaurants.
Net Loss Before Income Taxes
There was a net loss before income taxes of $1.8 million in Q2 2025, compared to a net income of $2.1 million in Q2 2024.
Decreased Adjusted EBITDA
Adjusted EBITDA decreased to $3.3 million in Q2 2025 from $5.9 million in Q2 2024, after removing preopening costs.
Challenges in New Markets
The South Korea location reported slow initial sales, though improvements are expected with further openings.
Company Guidance
During the second quarter of 2025, GEN Restaurant Group, Inc. opened nine new restaurants, bringing the total store count to 52, with plans to exceed the target of 12 to 13 new stores by the end of the year. The company's restaurant operations faced challenges such as macro pressures and immigration policies affecting key regions like California, Texas, and Nevada, which account for 35 of their locations. Despite these challenges, the company achieved an average unit volume (AUV) revenue of $5.3 million per restaurant, maintaining strong margins and a payback period of 2.3 years for new stores. Revenue increased by 2.2% year-over-year to $55 million, while the restaurant-level adjusted EBITDA was 16.3% for the quarter. The company incurred a net loss before income taxes of $1.8 million, equating to $0.05 per diluted share. GEN also made strategic moves, such as the international expansion to South Korea and the development of new product lines, including packaged meats and sauces, to boost brand strength. The company continues to invest in AI and automation to improve operational efficiencies and maintains a healthy balance sheet with $9.6 million in cash and minimal debt.

GEN Restaurant Group, Inc. Class A Financial Statement Overview

Summary
GEN Restaurant Group, Inc. Class A shows rapid revenue growth but faces significant challenges in profitability and financial stability. High leverage and negative profitability metrics indicate potential risks, while the cash flow situation suggests liquidity concerns. The company needs to improve cost management and reduce debt to enhance financial health.
Income Statement
45
Neutral
GEN Restaurant Group, Inc. Class A shows a mixed performance in its income statement. The TTM data indicates a significant revenue growth rate of 54.9%, which is a positive sign. However, the company is struggling with profitability, as evidenced by negative net profit and EBIT margins. The gross profit margin has also declined over the years, indicating potential cost management issues.
Balance Sheet
35
Negative
The balance sheet reveals a high debt-to-equity ratio of 4.24 in the TTM period, indicating significant leverage and potential financial risk. The return on equity is negative, reflecting losses and inefficiencies in generating returns for shareholders. The equity ratio is low, suggesting a heavy reliance on debt financing.
Cash Flow
40
Negative
Cash flow analysis shows a concerning trend with negative free cash flow and a high free cash flow to net income ratio, indicating cash flow issues. Although the operating cash flow is positive, it is not sufficient to cover the net income, suggesting potential liquidity challenges.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue216.14M208.38M181.01M163.73M140.56M62.66M
Gross Profit19.17M21.92M24.61M109.37M95.87M41.94M
EBITDA9.76M18.96M21.61M19.29M57.40M-3.78M
Net Income-741.00K592.00K8.41M10.28M49.86M224.00K
Balance Sheet
Total Assets246.33M240.41M183.87M138.88M31.99M33.13M
Cash, Cash Equivalents and Short-Term Investments9.61M23.68M32.63M11.20M9.57M7.15M
Total Debt174.10M163.01M121.07M121.64M15.32M22.63M
Total Liabilities203.80M194.80M146.35M144.14M39.32M38.80M
Stockholders Equity15.30M12.70M8.97M-10.01M-1.17M-8.04M
Cash Flow
Free Cash Flow-17.65M-6.00M5.01M15.29M30.32M-2.34M
Operating Cash Flow14.24M17.83M22.16M23.40M31.60M-2.05M
Investing Cash Flow-31.89M-26.80M-6.31M2.57M-10.33M-4.09M
Financing Cash Flow-2.12M18.00K5.58M-24.66M-18.54M6.61M

GEN Restaurant Group, Inc. Class A Technical Analysis

Technical Analysis Sentiment
Negative
Last Price3.11
Price Trends
50DMA
3.69
Negative
100DMA
3.88
Negative
200DMA
5.22
Negative
Market Momentum
MACD
-0.17
Negative
RSI
34.71
Neutral
STOCH
5.18
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GENK, the sentiment is Negative. The current price of 3.11 is below the 20-day moving average (MA) of 3.29, below the 50-day MA of 3.69, and below the 200-day MA of 5.22, indicating a bearish trend. The MACD of -0.17 indicates Negative momentum. The RSI at 34.71 is Neutral, neither overbought nor oversold. The STOCH value of 5.18 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GENK.

GEN Restaurant Group, Inc. Class A Risk Analysis

GEN Restaurant Group, Inc. Class A disclosed 67 risk factors in its most recent earnings report. GEN Restaurant Group, Inc. Class A 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

GEN Restaurant Group, Inc. Class A Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
$47.47M18.3421.75%2.93%20.81%
72
Outperform
$382.19M35.4819.65%-1.72%-70.31%
61
Neutral
$17.97B12.87-5.30%2.97%1.26%-14.45%
60
Neutral
$247.71M14.94-63.40%0.06%-12.14%
55
Neutral
$111.40M92.02%-3.09%-30.16%
46
Neutral
$103.74M36.29-5.04%0.96%10.67%-181.88%
39
Underperform
$84.20M-7.81%96.64%-292.65%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GENK
GEN Restaurant Group, Inc. Class A
3.11
-4.62
-59.77%
DENN
Denny's
4.61
-1.27
-21.60%
RAVE
Rave Restaurant Group
3.42
1.64
92.13%
RRGB
Red Robin Gourmet
6.17
3.13
102.96%
PBPB
Potbelly
12.65
5.06
66.67%
STKS
The ONE Group Hospitality
2.75
-0.40
-12.70%

GEN Restaurant Group, Inc. Class A Corporate Events

Executive/Board ChangesShareholder Meetings
GEN Restaurant Group Approves Key Proposals at Annual Meeting
Neutral
Jun 20, 2025

GEN Restaurant Group, Inc. held its 2025 Annual Meeting of Stockholders virtually on June 18, 2025. During the meeting, stockholders voted on two proposals: the election of David Kim as a Class III director until the 2028 Annual Meeting and the ratification of CBIZ CPAs P.C. as the independent registered public accounting firm for the fiscal year ending December 31, 2025. Both proposals were approved by the stockholders.

The most recent analyst rating on (GENK) stock is a Buy with a $12.00 price target. To see the full list of analyst forecasts on GEN Restaurant Group, Inc. Class A stock, see the GENK Stock Forecast page.

Dividends
GEN Restaurant Group Announces Special Cash Dividend
Positive
May 28, 2025

GEN Restaurant Group, Inc. has announced a special cash dividend of $0.03 per share for its Class A common stock, payable on June 23, 2025, to shareholders of record as of June 9, 2025. Additionally, GEN Restaurant Companies, LLC will distribute $0.03 per Class A and Class B Common Unit, with the total aggregate amount of these distributions reaching approximately $984 thousand.

The most recent analyst rating on (GENK) stock is a Buy with a $12.00 price target. To see the full list of analyst forecasts on GEN Restaurant Group, Inc. Class A stock, see the GENK Stock Forecast page.

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.Date of analysis: Aug 14, 2025