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El Pollo LoCo
(NASDAQ:LOCO)
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Rating:71Outperform
Price Target:
$17.00
▲(6.72% Upside)
Action:Reiterated
Date:08/08/26
The score is driven primarily by improving profitability and a stronger-looking leverage profile, reinforced by upbeat earnings-call momentum with raised guidance. The main constraints are weaker recent cash-flow conversion and mixed near-term technical momentum, while valuation appears reasonable rather than compelling.
Positive Factors
Margin Expansion
Sustained margin expansion and upgraded restaurant‑level guidance indicate durable operating leverage from higher check sizes, improved cost control, and unit productivity. This supports repeatable cash generation and resiliency to moderate cost swings over the next several quarters.
Negative Factors
Weakened Cash Generation
A sharp decline in operating and free cash flow versus prior years signals weaker cash conversion and potentially higher working capital or reinvestment needs. That reduces financial flexibility and increases sensitivity to margin or traffic setbacks over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Margin Expansion
Sustained margin expansion and upgraded restaurant‑level guidance indicate durable operating leverage from higher check sizes, improved cost control, and unit productivity. This supports repeatable cash generation and resiliency to moderate cost swings over the next several quarters.
Read all positive factors
El Pollo LoCo (LOCO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$462.58M
Dividend YieldN/A
Average Volume (3M)242.50K
Price to Earnings (P/E)12.6
Beta (1Y)0.83
Revenue Growth4.40%
EPS Growth39.48%
CountryUS
Employees4,034
SectorConsumer Cyclical
Sector Strength84
IndustryRestaurants
Share Statistics
EPS (TTM)1.18
Shares Outstanding30,432,938
10 Day Avg. Volume278,012
30 Day Avg. Volume242,502
Financial Highlights & Ratios
PEG Ratio1.98
Price to Book (P/B)1.05
Price to Sales (P/S)0.62
P/FCF Ratio12.03
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$20.63Price Target Upside29.47% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering5
EPS Forecast (FY)0.97
Revenue Forecast (FY)$503.90M
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
El Pollo Loco primarily makes money through restaurant sales and franchising-related income. The largest revenue stream is sales from company-operated restaurants, where the company earns revenue from food and beverage purchases made in-restaurant...
El Pollo LoCo Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 29, 2026
Earnings Call Sentiment Positive
The call conveyed clear operational momentum: positive same-store sales, margin improvement, digital and loyalty strength, successful menu innovation, and accelerated unit growth with raised EBITDA guidance and reduced capex. Headwinds remain around commodity inflation (notably produce), modest transaction declines, a quarter-over-quarter reliance on higher checks, a one-time legal settlement impacting G&A comparability, and a modest cash balance. Overall the positive drivers and upward guidance outweigh the challenges discussed.Positive Updates
Same-Store Sales and Revenue Growth
Systemwide same store sales grew 3.9% in Q2 2026; total revenue increased to $129.6M from $125.8M a year ago. Company-operated restaurant revenue rose 3.7% to $108.1M driven by 3% company comparable restaurant sales and contributions from newly opened company restaurants.
Negative Updates
Commodity Inflation and COGS Pressure
Food & paper costs increased ~90 basis points to 25.4% of company restaurant sales in Q2, driven primarily by a 4.1% commodity inflation spike (largely produce). Company expects full-year commodity inflation of 2.5%-3.5%.
Read all updates
Q2-2026 Updates
Positive
Negative
Same-Store Sales and Revenue Growth
Systemwide same store sales grew 3.9% in Q2 2026; total revenue increased to $129.6M from $125.8M a year ago. Company-operated restaurant revenue rose 3.7% to $108.1M driven by 3% company comparable restaurant sales and contributions from newly opened company restaurants.
Read all positive updates
Company Guidance
Management raised 2026 guidance, increasing full‑year system‑wide comparable same‑store sales to 3.5%–4.5% (Q3 to date through 7/29 at +5.8% and Q3 guidance ~3.5%–4.5%), and upping adjusted EBITDA to $68–70 million while trimming CapEx to $33–37 million and projecting depreciation & amortization of $18–18.5 million. They reiterated new unit growth of roughly 18–20 openings (3–4 company and 15–16 franchise), maintained G&A of $52–54 million excluding one‑time items, and an estimated effective tax rate of ~29%–29.5% (pre‑discrete). Restaurant‑level margin is expected to improve to 18.25%–18.75% for the year (Q3 guide 18%–18.5%), with full‑year commodity inflation forecast at 2.5%–3.5% and wage inflation at 1.5%–2.5%. Liquidity as of 7/1/2026 included $30 million of debt, $13.3 million cash, a $150 million revolver extended to 8/4/2031, and a $21 million net revolver paydown year‑to‑date.El Pollo LoCo Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
82
Very Positive
Cash Flow
54
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 500.79M | 490.05M | 473.01M | 468.66M | 469.96M | 454.36M |
| Gross Profit | 141.84M | 140.35M | 103.52M | 93.37M | 83.70M | 99.27M |
| EBITDA | 65.58M | 58.01M | 56.91M | 55.09M | 44.97M | 56.45M |
| Net Income | 34.86M | 26.49M | 25.68M | 25.55M | 20.80M | 29.12M |
Balance Sheet | ||||||
| Total Assets | 618.79M | 606.65M | 592.01M | 592.30M | 597.22M | 613.79M |
| Cash, Cash Equivalents and Short-Term Investments | 13.28M | 6.23M | 2.48M | 7.29M | 20.49M | 30.05M |
| Total Debt | 219.40M | 239.57M | 263.02M | 273.33M | 252.88M | 233.47M |
| Total Liabilities | 301.74M | 315.57M | 331.35M | 341.61M | 316.07M | 303.16M |
| Stockholders Equity | 317.04M | 291.08M | 260.67M | 250.70M | 281.15M | 310.62M |
Cash Flow | ||||||
| Free Cash Flow | 41.01M | 25.44M | 27.70M | 19.36M | 18.63M | 35.06M |
| Operating Cash Flow | 73.94M | 48.08M | 46.78M | 40.69M | 38.55M | 52.10M |
| Investing Cash Flow | -32.94M | -22.64M | -18.94M | -13.45M | -18.91M | -12.48M |
| Financing Cash Flow | -36.71M | -21.70M | -32.65M | -40.45M | -29.19M | -22.79M |
El Pollo LoCo Technical Analysis
Negative
15.93
Price Trends
15.88
Negative
14.86
Negative
12.85
Positive
Market Momentum
-0.12
Positive
35.02
Neutral
6.54
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOCO, the sentiment is Negative. The current price of 15.93 is below the 20-day moving average (MA) of 16.14, above the 50-day MA of 15.88, and above the 200-day MA of 12.85, indicating a neutral trend. The MACD of -0.12 indicates Positive momentum. The RSI at 35.02 is Neutral, neither overbought nor oversold. The STOCH value of 6.54 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 |
|---|---|---|---|---|---|---|---|
71 Outperform | $462.58M | 12.57 | 11.68% | ― | 4.40% | 39.48% | |
66 Neutral | $5.53B | 29.52 | 38.83% | 1.35% | 5.66% | 14.01% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
55 Neutral | $340.27M | 9.60 | -3.80% | ― | -17.16% | ― | |
52 Neutral | $1.39B | 11.44 | 109.00% | 8.01% | -0.98% | -31.26% | |
46 Neutral | $785.18M | 30.02 | -6.17% | 6.06% | -5.65% | -64.96% |
* Consumer Cyclical Sector Average
LOCO
El Pollo LoCo
15.20
4.51
42.19%
JACK
Jack In The Box
18.77
0.10
0.54%
PZZA
Papa John's International
24.09
-21.24
-46.85%
CAKE
Cheesecake Factory
117.29
53.67
84.37%
WEN
Wendy's
8.66
-1.08
-11.06%
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.