Portillo's (PTLO) AI Stock Analysis

• Market Cap: $476.20M
• Dividend Yield: N/A
• Average Volume (3M): 3.47M
• Price to Earnings (P/E): 13.8
• Beta (1Y): 0.92
• Revenue Growth: 3.62%
• EPS Growth: 17.67%
• Country: US
• Employees: 8,512
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 0.12
• Shares Outstanding: 71,905,580
• 10 Day Avg. Volume: 3,207,548
• 30 Day Avg. Volume: 3,465,037
• PEG Ratio: 0.46
• Price to Book (P/B): 1.39
• Price to Sales (P/S): 0.78
• P/FCF Ratio: 56.41
• Enterprise Value/Market Cap: 3.04
• Enterprise Value/Revenue: 2.01
• Enterprise Value/Gross Profit: 4.70
• Enterprise Value/Ebitda: 15.45
• 1Y Price Target: $10.11
• Price Target Upside: 60.48% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 10

• Rating: 67 Neutral
• Price Target: $7.50 ▲(19.05% Upside)

Portillo's overall stock score reflects strong financial performance and positive corporate events. However, bearish technical indicators and moderate valuation weigh on the score. The company's strategic initiatives and leadership changes are promising, but market challenges and inflationary pressures need to be addressed.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, supporting long-term financial health.

Operational Improvements

Investing in technology enhances operational efficiency, potentially improving customer experience and reducing costs.

Leadership Strength

The addition of experienced leadership can drive strategic growth and operational excellence, benefiting long-term company performance.

Negative Factors

Rising Costs

Increasing commodity and labor costs can pressure margins, potentially affecting profitability if not managed effectively.

Cash Flow Concerns

Declining cash from operations may impact the company's ability to fund growth initiatives and manage financial obligations.

New Market Challenges

Challenges in new markets can hinder expansion efforts and revenue growth, requiring strategic adjustments to succeed.

Portillo's Business Overview & Revenue Model

Company Description

Portillo's, Inc. is a fast-casual restaurant chain based in the United States, primarily known for its Chicago-style hot dogs, Italian beef sandwiches, and other classic American fare. Founded in 1963, the company operates a number of locations across several states, offering a unique dining experience that combines quality food with a nostalgic atmosphere. Portillo's menu also includes burgers, salads, and desserts, catering to a diverse customer base. The company has carved out a niche in the fast-casual dining sector, appealing to both dine-in and takeout customers.

How the Company Makes Money

Portillo's generates revenue primarily through the sale of food and beverages at its restaurant locations. The company operates a direct-to-consumer model, where customers can order food for dining in, carryout, or delivery. Key revenue streams include dine-in sales, takeout orders, and catering services for events. Additionally, Portillo's has expanded its brand through online ordering and delivery partnerships with third-party services, which has become increasingly significant in urban areas. The company's focus on high-quality ingredients and customer service helps drive repeat business and brand loyalty, contributing to its overall financial performance.

Portillo's Financial Statement Overview

Summary

Portillo's demonstrates strong financial health with robust revenue growth and improved profitability metrics, though there is room for improvement in operating efficiencies and capital expenditure management.

Income Statement

Portillo's exhibits strong revenue growth with a TTM (Trailing-Twelve-Months) increase of 6.0% from the previous year. The gross profit margin has improved to 42.8% from 38.8% in 2022, showing enhanced cost efficiency. Net profit margin stands at 3.9% TTM, which is a positive turn from previous losses, indicating better profitability management. However, the EBITDA margin at 13.0% suggests room for improving operating efficiencies compared to industry standards.

Balance Sheet

The company's balance sheet shows a moderate Debt-to-Equity ratio of 1.50 TTM, indicating a balanced leverage position relative to equity. Return on Equity (ROE) has improved to 6.9% TTM, reflecting better utilization of equity to generate profits. The equity ratio is 27.1% TTM, which suggests a stable capital structure but indicates potential risk if debt levels increase.

Cash Flow

Operating cash flow to net income ratio of 3.48 TTM highlights strong cash generation relative to net profits. Free cash flow growth rate is negative at -17.6% TTM, mainly due to increased capital expenditures, which could impact cash reserves if not managed carefully. The free cash flow to net income ratio is 0.29 TTM, demonstrating some reliance on free cash flow to support net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	721.16M	710.55M	679.90M	587.10M	534.95M	455.47M
Gross Profit	308.37M	168.11M	275.17M	132.51M	142.08M	121.94M
EBITDA	93.72M	94.79M	79.85M	61.50M	52.78M	81.22M
Net Income	28.27M	29.52M	18.42M	10.85M	-54.00M	-8.26M
Balance Sheet
Total Assets	1.50B	1.50B	1.39B	1.28B	999.57M	910.22M
Cash, Cash Equivalents and Short-Term Investments	12.94M	22.88M	10.44M	44.43M	39.26M	41.21M
Total Debt	611.60M	596.23M	550.41M	523.60M	319.15M	469.70M
Total Liabilities	1.00B	1.01B	925.43M	847.18M	576.17M	769.51M
Stockholders Equity	406.88M	401.06M	322.38M	256.34M	171.26M	140.71M
Cash Flow
Free Cash Flow	8.12M	9.85M	-17.14M	9.83M	6.69M	36.82M
Operating Cash Flow	98.41M	98.04M	70.78M	56.89M	42.87M	58.27M
Investing Cash Flow	-90.22M	-88.11M	-87.84M	-47.02M	-36.26M	-21.42M
Financing Cash Flow	-8.45M	2.51M	-16.93M	-4.71M	-8.78M	-18.05M

Portillo's Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 6.30
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PTLO, the sentiment is Negative. The current price of 6.3 is below the 20-day moving average (MA) of 6.44, below the 50-day MA of 7.76, and below the 200-day MA of 10.86, indicating a bearish trend. The MACD of -0.39 indicates Negative momentum. The RSI at 34.52 is Neutral, neither overbought nor oversold. The STOCH value of 49.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PTLO.

Portillo's Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CAKE	68 Neutral	$2.73B	16.85	39.63%	1.97%	4.77%	38.24%
PTLO	67 Neutral	$476.20M	13.84	7.36%	―	3.62%	17.67%
BJRI	67 Neutral	$669.70M	25.46	7.12%	―	4.07%	-1.24%
FWRG	63 Neutral	$976.38M	244.65	3.18%	―	14.53%	-83.26%
PZZA	60 Neutral	$1.54B	20.71	-17.38%	3.91%	-1.46%	8.10%
CBRL	58 Neutral	$1.01B	22.04	10.05%	2.20%	0.37%	12.99%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Portillo's Corporate Events

Portillo’s Reports Strong Q2 2025 Financial Results

Portillo’s Inc. reported its financial results for the second quarter of 2025, showing a revenue increase of 3.6% to $188.5 million and a net income rise of 17.7% to $10 million compared to the same period in 2024. Despite a challenging traffic environment, the company managed to maintain strong earnings and plans to open 12 new restaurants in the second half of 2025, focusing on expanding in the Sunbelt region and introducing new restaurant formats to improve efficiency and consumer engagement.

Portillo’s Appoints Eugene Lee to Board of Directors

On June 16, 2025, Portillo’s announced the appointment of Eugene I. Lee, Jr., a seasoned leader in the restaurant industry, to its Board of Directors. Mr. Lee, who previously served as CEO of Darden Restaurants, is expected to bring valuable expertise in operations and growth strategy to Portillo’s. His appointment aligns with Portillo’s cooperation agreement and is supported by Engaged Capital, LLC, highlighting the company’s focus on continued growth and value creation for stakeholders.

Portillo’s Holds Annual Shareholders Meeting, Elects Directors

On June 10, 2025, Portillo’s Inc. held its Annual Meeting of Shareholders where eight directors were elected to serve until the next annual meeting in 2026. Shareholders approved the compensation of the company’s Named Executive Officers and ratified Deloitte & Touche LLP as the independent auditor for fiscal year 2025. A shareholder proposal regarding stockholders’ ability to call special meetings was rejected. The company had previously announced a cooperation agreement with Engaged Capital, LLC on April 28, 2025.