Our full earnings preview showed just exactly how much anticipation there was going into this earnings report. And the reaction has been big!
El Pollo Loco gave guidance for the rest of the 2014 fiscal year in the form of sales growth of approximately 5.5% to 6% including a 5% to 5.5% increase for company-operated restaurants. The company also plans on opening 9 to 11 new company-owned restaurants and 4 new franchised restaurants. It also plans on having a 21.4% to 21.6% restaurant contribution margin.
A successful initial public offering gave the company a very favorable position beating many analyst price targets in only a little over a month that it has been in the market. El Pollo Loco plans on using this money to further expand and open up more franchises specifically 12 within the greater Houston market.
Steve Sather, the president and CEO of El Pollo Loco, had this to say:
As a result of our successful IPO, we have strengthened our capital structure to provide the financial flexibility to accelerate the growth of our business, augment our competitive position, and further enhance our brand. We believe El Pollo Loco has significant potential to grow its store base, including a substantial opportunity within our existing markets, as well as new markets.
El Pollo Loco shares closed at $34.79, and the reaction has been up 5.5% to $36.71 in the after-hours session after almost an hour since the close. Its post-IPO trading range is $18.48 to $41.70 and the consensus analyst price target was $28.00 before any changes from the earnings report.
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