As Mediterranean restaurant chain Cava Group looks to serve up yet another new high, it shares three noteworthy things in common with Wingstop. Both stocks make the IBD Leaderboard watchlist. Plus, WING stock and Cava both found a seat at the table of this month's list of new buys by the best mutual funds.
Wingstop and Cava have also landed on IBD's premier stock screens. Wingstop earns a spot on the IBD 50, while Cava joins six other names on the IPO Leaders list.
Wingstop Stock Spices Up Multiple Buy Points
While hitting some turbulence along the way, Cava stock has soared off the low it hit in October, 2023, just months after its IPO in June of that year. The fast-growing restaurant chain rose an eye-popping 341% from that October low until hitting a record high last month.
Meanwhile, Wingstop stock is serving up multiple potential buy points. One is a 431.03 entry in a second-stage consolidation pattern. The stock's current consolidation started in early July. It shows a relatively shallow pullback of 21%, a positive sign in what has been a volatile period for the Nasdaq.
The purveyor of chicken wings, which operates and franchises over 2,350 locations worldwide, has also added a faulty handle, which offers an alternative buy point of 409.77. Up nearly 4% Monday, Wingstop closed just sho of that entry at 409.
The IBD 50 stock has just cleared a trendline entry near 405 as well.
Wingstop Delivers Tasty Growth
Operating in 45 states and 11 countries, Wingstop offers classic and boneless wings, tenders and chicken sandwiches. Its lineup of cooked-to-order fare comes in a range of flavors, including the new Sweet BBQ Blaze.
The company's focus on digital orders and delivery has proved a profitable strategy, helping drive a strong rebound in Wingstop stock over the last two years.
Sales growth remains solid and steady, ranging from 21% to 46% over the last eight quarters. On July 31, Wingstop reported sales of $155.7 million for the second quarter, a 45% year-over-year increase.
After a dip to 7% earnings growth in Q4, Wingstop drove two quarters of strong double-digit gains to kick off the year. In Q2, the wings specialist posted earnings growth of 93 cents per share, a 63% rise over the prior-year quarter.
For the third quarter, analysts forecast a 37% rise in earnings to 94 cents per share. For the full year, Wall Street sees a 52% rise to $3.76 a share.
Follow Matthew Galgani on X (formerly Twitter) at @IBD_MGalgani.
