Portillo's (PTLO) AI Stock Analysis

• Market Cap: $425.87M
• Dividend Yield: N/A
• Average Volume (3M): 2.39M
• Price to Earnings (P/E): 15.6
• Beta (1Y): 0.94
• Revenue Growth: 2.40%
• EPS Growth: -14.90%
• Country: US
• Employees: 8,512
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 0.02
• Shares Outstanding: 71,932,310
• 10 Day Avg. Volume: 2,093,526
• 30 Day Avg. Volume: 2,387,720
• 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: 2.45
• Enterprise Value/Revenue: 1.43
• Enterprise Value/Gross Profit: 4.17
• Enterprise Value/Ebitda: 12.41
• 1Y Price Target: $6.30
• Price Target Upside: 11.50% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 8
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 68 Neutral
• Price Target: $6.50 ▲(15.04% Upside)

The score is driven primarily by solid financial performance (improving margins and strong operating cash generation), tempered by weak technicals (price below key moving averages and negative MACD). Valuation looks reasonable on P/E, while the earnings call and recent event commentary point to a cautious near-term backdrop due to traffic declines and cost inflation despite strategic initiatives (Perks, tighter development discipline).

Positive Factors

Improving gross and net margins

Sustained improvement in gross and net margins reflects better cost control and pricing power at the restaurant level. Higher margins provide durable support for profitability through economic cycles, enabling investment in growth, marketing, and unit-level returns without relying solely on revenue expansion.

Strong operating cash generation

A high OCF-to-net-income ratio indicates the business converts reported profits into cash reliably, giving management flexibility to fund capex, repay debt, and invest in initiatives like smaller formats or loyalty programs. This cash resilience supports multi-year execution of strategy.

Brand strength and loyalty driving unit performance

A recognized brand with a growing Perks loyalty program and above-peer average unit volumes creates durable competitive advantage. Strong openings and multi-channel sales mix suggest scalable demand in new markets, improving long-term unit economics and reducing execution risk for expansions.

Negative Factors

Declining same-restaurant sales and transactions

Persistent traffic and transaction declines erode unit-level economics and limit sales leverage from fixed costs. If trends continue, management may face tougher decisions on pricing, promotions, or marketing spend, making consistent growth and margin recovery harder over several quarters.

Material labor and commodity cost pressure

Elevated labor and commodity inflation are structural margins headwinds for quick-service restaurants. Higher wage and input cost baselines compress restaurant-level EBITDA unless offset by sustained pricing, mix improvement, or productivity gains—each of which carries execution risk.

Moderate leverage and negative FCF growth from capex

A moderate debt load combined with declining free cash flow from elevated capex reduces financial flexibility. This constrains the firm's ability to fund expansion, weather margin volatility, or pursue opportunistic investments without either raising more capital or slowing development.

Portillo's Business Overview & Revenue Model

Company Description

Portillo's Inc., together with its subsidiaries, engages in the ownership and operation of fast casual and quick service restaurants in the United States. The company offers Chicago-style hot dogs and sausages, Italian beef sandwiches, char-grilled burgers, chopped salads, crinkle-cut French fries, homemade chocolate cakes, and chocolate cake shakes. As of March 10, 2022, it operated in 70 locations across nine states. The company also offers its products through its website. Portillo's Inc. was founded in 1963 and is based in Oak Brook, Illinois.

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

Strong income statement momentum with improving gross margin (42.8% TTM) and a positive net margin (3.9% TTM), supported by solid operating cash generation (OCF/net income 3.48 TTM). Offsetting factors include moderate leverage (Debt-to-Equity 1.50 TTM) and declining free cash flow growth (-17.6% TTM) tied to higher capex.

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	730.93M	710.55M	679.90M	587.10M	534.95M	455.47M
Gross Profit	250.52M	287.78M	275.17M	228.47M	229.40M	197.03M
EBITDA	84.17M	94.79M	79.85M	67.53M	46.06M	81.88M
Net Income	24.50M	29.52M	18.42M	10.85M	5.99M	12.26M
Balance Sheet
Total Assets	1.59B	1.50B	1.39B	1.28B	999.57M	910.22M
Cash, Cash Equivalents and Short-Term Investments	17.23M	22.88M	10.44M	44.43M	39.26M	41.43M
Total Debt	655.31M	596.23M	550.41M	523.60M	319.15M	469.70M
Total Liabilities	1.10B	1.01B	925.43M	847.18M	576.17M	769.51M
Stockholders Equity	459.42M	401.06M	322.38M	256.34M	171.26M	140.71M
Cash Flow
Free Cash Flow	-9.98M	9.85M	-17.14M	9.83M	6.69M	36.82M
Operating Cash Flow	54.78M	98.04M	70.78M	56.89M	42.87M	58.27M
Investing Cash Flow	-64.75M	-88.11M	-87.84M	-47.02M	-36.26M	-21.42M
Financing Cash Flow	8.07M	2.51M	-16.93M	-4.71M	-8.78M	-18.05M

Portillo's Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 5.65
• 50DMA: Positive
• 100DMA: Positive
• 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 Neutral. The current price of 5.65 is above the 20-day moving average (MA) of 5.38, above the 50-day MA of 5.03, and below the 200-day MA of 7.91, indicating a neutral trend. The MACD of 0.25 indicates Negative momentum. The RSI at 58.65 is Neutral, neither overbought nor oversold. The STOCH value of 33.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PTLO.

Portillo's Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BJRI	71 Outperform	$883.86M	31.30	8.44%	―	3.85%	7.57%
NATH	71 Outperform	$414.03M	18.20	―	2.09%	7.81%	4.58%
PTLO	68 Neutral	$425.87M	15.62	5.82%	―	2.40%	-14.90%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
BLMN	52 Neutral	$511.30M	-8.47	10.80%	10.60%	-13.07%	-1139.12%

Portillo's Corporate Events

Portillo’s Highlights Growth Strategy at 2026 ICR Conference

On January 12, 2026, Portillo’s Inc. planned to present at the 2026 ICR Conference, with Interim Chief Executive Officer Mike Miles and Chief Financial Officer Michelle Hook outlining the company’s brand strength, growth performance and profitability initiatives to the investment community. The materials highlight Portillo’s strong customer enthusiasm, robust multi-channel sales mix and top-tier average unit volumes versus prominent fast-casual peers, alongside evidence of pent-up demand in new markets such as its Kennesaw, Georgia location, which opened on November 14, 2025 and delivered one of the chain’s largest openings to date. The presentation also underscores the company’s growing Perks loyalty program and details a broad range of operational, macroeconomic, technology, labor and regulatory risks that could affect its growth strategy and financial results, signaling both the opportunities and vulnerabilities that investors and other stakeholders need to consider.

The most recent analyst rating on (PTLO) stock is a Hold with a $6.00 price target. To see the full list of analyst forecasts on Portillo’s stock, see the PTLO Stock Forecast page.

Portillo’s Reports Q3 2025 Revenue Growth Amid Challenges

Portillo’s Inc. reported its third-quarter 2025 financial results, showing a total revenue increase of 1.8% to $181.4 million, attributed to new restaurant openings. However, the company faced challenges with a decrease in same-restaurant sales by 0.8% and a significant drop in operating income by 66% to $5.4 million. The company is focusing on resetting its growth model to improve unit economics and has opened its first in-line restaurant format, with plans for further expansion.

The most recent analyst rating on (PTLO) stock is a Hold with a $5.50 price target. To see the full list of analyst forecasts on Portillo’s stock, see the PTLO Stock Forecast page.

Portillo’s Announces Departure of Chief Development Officer

On October 29, 2025, Portillo’s announced the departure of Mike Ellis as Chief Development Officer, effective October 31, 2025. His exit will be considered a qualifying termination under the Senior Executive Severance Plan, entitling him to various benefits, including cash compensation, a prorated annual bonus, health insurance reimbursement, and outplacement services. Additionally, his restricted stock units will vest immediately, while other equity grants will be forfeited.

The most recent analyst rating on (PTLO) stock is a Buy with a $6.50 price target. To see the full list of analyst forecasts on Portillo’s stock, see the PTLO Stock Forecast page.