Wingstop Finally Files for IPO

This IPO has been in the works since late in 2014, as far as the prior reports that it was speaking to bankers. The company and shareholders have filed to sell up to $86.25 million in shares in the IPO, although this figure can change before the offering comes to fruition. Wingstop’s filing showed that its book runners were listed as Morgan Stanley, Jefferies and Baird. Co-managers for the offering were listed as Goldman Sachs, Barclays and Wells Fargo Securities.

According to the filing, the company intends to apply for listing of its common stock on The Nasdaq Global Select Market under the symbol WING.

24/7 Wall St. is not automatically endorsing Wingstop’s claim of being the largest of its kind. The reality is that it and Buffalo Wild Wings are two very different companies, and even their business models are different. Wingstop’s filing said:

We are the largest fast casual chicken wings-focused restaurant chain in the world, and have demonstrated strong, consistent growth on a national scale. We have sold approximately 4 billion wings over the last 20 years, as we grew to 712 restaurants across 36 states and 6 countries, as of December 27, 2014.

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Wingstop was founded in 1994 in Garland, Texas. Its IPO filing showed that its average transaction size in 2014 was $15.61 and that carry-out orders constituted approximately 75% of its sales. As of December 27, 2014, its restaurant base was 97% franchised, with 693 franchised locations. This includes 41 international locations, and it has 19 company-owned restaurants.

On a year-over-year basis, for fiscal year 2014, Wingstop’s total revenue increased by 14.3% to $67.4 million, its adjusted EBITDA was shown to have risen by 25% to $24.4 million, its adjusted EBITDA margin increased 310 basis points to 36.1% and its net income rose by 19.3% to $9.0 million.

So, how does Wingstop stack up against Buffalo Wild Wings? The reality is that these are truly different companies. How Wingstop claims to be the largest fast casual chicken wings-focused restaurant chain in the world is because of it being focused on wings, fries and sides, for 90% of its sales. It shows that competitors are bar and sports-centric settings.

Buffalo Wild Wings said with its most recent earnings report that currently it has more than 1,080 locations in the United States, Canada, Mexico and Philippines. Its total quarterly March revenues, which included restaurant sales and franchise fees and royalties, were $440.586 million.

For the year ended Dec. 28 2014, Buffalo Wild Wings had total revenues of $1.516 billion, up from $1.226 billion in 2013. Wingstop’s revenues were far lower in 2014, due to the franchise model, at $67.449 million ($38 million of which were from royalties and franchise fees).

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Another top restaurant growth chain will soon be public.

FULL IPO FILING