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El Pollo LoCo Holdings (LOCO)
:LOCO
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El Pollo LoCo
(NASDAQ:LOCO)
Rating:70Outperform
Price Target:
$11.50
▲(9.63%Upside)
Positive Factors
Earnings
El Pollo Loco reported better than expected results across most metrics, with revenue and earnings surpassing consensus expectations.
New Product Launches
Menu innovation has been driving positive results, with successful launches of new products like Fresca wraps and premium chicken quesadillas.
Negative Factors
Competitive Environment
The company has moved into a period where traffic growth is needed to drive same-store sales, which may prove challenging in the current competitive environment.
Sales Decline
Systemwide comparable sales declined slightly, with a drop in franchised locations.
El Pollo LoCo (LOCO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$314.05M
Dividend YieldN/A
Average Volume (3M)357.35K
Price to Earnings (P/E)12.4
Beta (1Y)1.10
Revenue Growth1.85%
EPS Growth-0.99%
CountryUS
Employees4,000
SectorConsumer Cyclical
Sector Strength62
IndustryRestaurants
Share Statistics
EPS (TTM)0.28
Shares Outstanding30,052,185
10 Day Avg. Volume343,168
30 Day Avg. Volume357,349
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.80
Enterprise Value/Revenue1.19
Enterprise Value/Gross Profit6.00
Enterprise Value/Ebitda10.06
Forecast
1Y Price Target
$14.50Price Target Upside38.23% Upside
Rating ConsensusHold
Number of Analyst Covering4
El Pollo LoCo Business Overview & Revenue Model
Company DescriptionEl Pollo Loco Holdings, Inc., through its subsidiary, El Pollo Loco, Inc., develops, franchises, licenses, and operates quick-service restaurants under the El Pollo Loco name. As of May 04, 2022, the company operated 480 restaurants comprising 189 company-operated and 291 franchised restaurants located in California, Nevada, Arizona, Texas, Utah, and Louisiana. It also licenses one restaurant in the Philippines. The company was formerly known as Chicken Acquisition Corp. and changed its name to El Pollo Loco Holdings, Inc. in April 2014. El Pollo Loco Holdings, Inc. was founded in 1975 and is headquartered in Costa Mesa, California.
How the Company Makes MoneyEl Pollo Loco generates revenue primarily through the sale of food and beverages at its company-operated restaurants. The company also earns income through franchise fees and royalties from its franchised locations. A significant portion of its revenue comes from its core product, the fire-grilled chicken, which is complemented by sides, drinks, and other menu items that encourage larger ticket sales. Additionally, El Pollo Loco engages in strategic partnerships and marketing initiatives to enhance brand recognition and drive customer traffic. The company's ability to maintain consistent quality and service, along with its strategic location choices, also plays a crucial role in sustaining and growing its revenue streams.
El Pollo LoCo Earnings Call Summary
Earnings Call Date:Jul 31, 2025
(Q2-2025)
| % Change Since: 1.84%|
Next Earnings Date:Oct 30, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive outlook with strong revenue growth, a return to positive traffic growth, and successful product innovations. However, challenges such as a slight decrease in transactions, a decrease in franchise comparable sales, and a challenging macroeconomic environment were noted. The company remains confident in its strategic initiatives to drive future growth.Q2-2025 Updates
Positive Updates
Revenue Growth
Total revenue increased to $125.8 million, up from $122.2 million in the second quarter of 2024. Company-operated restaurant revenue increased by 2% to $104.3 million.
Traffic Growth
Return to positive system-wide traffic growth, driven by innovation and targeted discounting strategies.
New Product Launches
Fresca Wraps and Salads, as well as new premium chicken quesadillas in two bold flavors, were introduced, receiving positive guest feedback.
Digital Sales Growth
Digital business, including kiosks, grew to 25.5% of sales compared to 17.1% in the second quarter of last year.
Unit Economics Improvement
Restaurant level operating profit margins improved to over 19%.
Expansion Plans
Plan to open at least 10 new restaurants in 2025, with the goal to almost double this pace in 2026.
Remodeling Effort
Expectation to remodel between 55 to 65 system-wide restaurants in 2025, with 20 completed by the end of the second quarter.
Negative Updates
Slight Decrease in Transactions
Company-operated comparable restaurant sales included a slight decrease in transactions of 0.3%.
Franchise Comparable Sales Decrease
Franchise comparable restaurant sales decreased by 1.1%.
Challenging Macro Environment
The macroeconomic environment remains challenging, impacting consumer spending and creating pressure on pricing strategies.
July Sales Slowdown
A slowdown in sales was observed in July, described as 'choppy,' potentially impacting third-quarter results.
Higher Operating Expenses
Occupancy and other operating expenses as a percentage of company restaurant sales increased by 150 basis points.
Company Guidance
During the El Pollo Loco Second Quarter 2025 Earnings Conference Call, the company provided guidance on several key metrics. Total revenue for the quarter was reported at $125.8 million, with company-operated restaurant revenue at $104.3 million, marking a 2% increase from the previous year. The company experienced a 1.2% increase in company-operated comparable restaurant sales, driven by a 1.5% increase in average check size, although transactions slightly decreased by 0.3%. Franchise revenue increased by 14.8% to $13.4 million, despite a 1.1% decrease in franchise comparable restaurant sales. The restaurant contribution margin improved to 19.1%, with expectations for full-year margins between 17.25% and 17.75%. El Pollo Loco plans to open 10 to 11 system-wide restaurants in 2025, with capital spending projected at $31 million to $34 million and G&A expenses anticipated to be between $48 million and $51 million. The effective income tax rate is expected to range from 29% to 29.5%.El Pollo LoCo Financial Statement Overview
Summary
El Pollo LoCo demonstrates solid financial health with consistent revenue growth and robust cash flow generation. However, the increase in debt and the decline in free cash flow growth present areas to monitor, particularly regarding leverage and capital expenditures.Income Statement
El Pollo LoCo has shown consistent revenue growth over recent periods, with a slight increase in TTM (Trailing-Twelve-Months) revenue compared to the previous year. The company maintains healthy gross and EBIT margins, indicating effective cost management. However, the net profit margin has slightly decreased, suggesting potential increases in operating expenses or interest costs.75
Positive
Balance Sheet
The balance sheet shows a stable equity base with a reasonable debt-to-equity ratio. Stockholders' equity has been consistent, and the equity ratio indicates a balanced approach to leveraging assets. However, the total debt has increased in TTM, which might pose a risk if not managed well.70
Positive
Cash Flow
El Pollo LoCo's cash flow analysis shows a drop in free cash flow growth in the TTM period, reflecting higher capital expenditures. The operating cash flow to net income ratio remains strong, suggesting effective cash generation relative to profits. However, the decline in free cash flow could impact future liquidity if the trend continues.68
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 476.03M | 473.01M | 468.66M | 469.96M | 454.36M | 426.09M |
| Gross Profit | 94.27M | 87.80M | 93.37M | 83.70M | 99.27M | 93.67M |
| EBITDA | 56.23M | 56.91M | 55.09M | 44.51M | 59.92M | 56.24M |
| Net Income | 25.25M | 25.68M | 25.55M | 20.80M | 29.12M | 24.47M |
Balance Sheet | ||||||
| Total Assets | 590.45M | 592.01M | 592.30M | 597.22M | 613.79M | 605.22M |
| Cash, Cash Equivalents and Short-Term Investments | 4.32M | 2.48M | 7.29M | 20.49M | 30.05M | 13.22M |
| Total Debt | 261.54M | 263.02M | 273.33M | 252.88M | 233.47M | 263.13M |
| Total Liabilities | 324.75M | 331.35M | 341.61M | 316.07M | 303.16M | 327.64M |
| Stockholders Equity | 265.70M | 260.67M | 250.70M | 281.15M | 310.62M | 277.58M |
Cash Flow | ||||||
| Free Cash Flow | 22.05M | 27.70M | 19.36M | 18.63M | 35.06M | 33.86M |
| Operating Cash Flow | 40.35M | 46.78M | 40.69M | 38.55M | 52.10M | 40.55M |
| Investing Cash Flow | -18.21M | -18.94M | -13.45M | -18.91M | -12.48M | -6.69M |
| Financing Cash Flow | -26.94M | -32.65M | -40.45M | -29.19M | -22.79M | -28.71M |
El Pollo LoCo Technical Analysis
Negative
10.49
Price Trends
10.67
Negative
10.20
Positive
11.13
Negative
Market Momentum
-0.07
Positive
45.44
Neutral
24.70
Neutral
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 10.49 is below the 20-day moving average (MA) of 10.74, below the 50-day MA of 10.67, and below the 200-day MA of 11.13, indicating a bearish trend. The MACD of -0.07 indicates Positive momentum. The RSI at 45.44 is Neutral, neither overbought nor oversold. The STOCH value of 24.70 is Neutral, 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
Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $314.05M | 12.41 | 9.46% | ― | 1.85% | -0.99% | |
70 Outperform | $12.14B | 28.21 | 33.55% | 1.41% | 15.09% | 31.24% | |
67 Neutral | ¥266.96B | 13.51 | 6.53% | 2.53% | 5.16% | -13.66% | |
66 Neutral | $4.77B | 240.88 | 4.16% | ― | 13.13% | -25.05% | |
65 Neutral | $1.91B | 10.63 | 90.40% | 8.94% | 2.18% | -5.15% | |
56 Neutral | $1.37B | 17.70 | -20.16% | 4.40% | -2.77% | 4.01% | |
50 Neutral | $363.05M | ― | 4.15% | 9.15% | -6.02% | -289.54% |
* Consumer Cyclical Sector Average
Performance Comparison
LOCO
El Pollo LoCo
10.49
-1.30
-11.03%
JACK
Jack In The Box
19.04
-32.32
-62.93%
PZZA
Papa John's International
40.08
-1.17
-2.84%
TXRH
Texas Roadhouse
184.79
20.65
12.58%
WEN
Wendy's
9.82
-6.01
-37.97%
SHAK
Shake Shack
115.47
16.16
16.27%
El Pollo LoCo Corporate Events
Shareholder MeetingsBusiness Operations and Strategy
El Pollo Loco Approves Governance Amendments at Annual Meeting
Neutral
Jun 5, 2025
El Pollo Loco Holdings, Inc. held its Annual Meeting on May 29, 2025, where stockholders approved several significant amendments to the company’s governance structure. These included declassifying the Board of Directors and eliminating supermajority voting requirements, effective June 3, 2025. Additionally, stockholders voted on six proposals, including the election of directors and ratification of the company’s independent accounting firm, BDO USA, P.C. The approval of these amendments marks a shift towards more streamlined governance, potentially impacting the company’s decision-making processes and stakeholder engagement.
The most recent analyst rating on (LOCO) stock is a Hold with a $13.00 price target. To see the full list of analyst forecasts on El Pollo LoCo stock, see the LOCO 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.