BJ’s Restaurants hit yearly high as food industry sees green

BJ’s Restaurants (BJRI) stock touched a new yearly higher of $61.80 on Friday, with market analysts expecting strong performance from the restaurant operator’s top and bottom line for this quarter. Most of the stocks in the restaurant industry are looking toward an upward trend, followed by Darden Restaurants’ (DRI) upbeat quarterly results.

During the recently completed first-quarter, BJ’s Restaurants benefited from slow roast menu items, Daily Brewhouse Specials, and its handheld server tablets. These can be seen from the 4.2% growth in comparable restaurant sales, a 0.4% rise in guest traffic and a 27% jump in operating income.

By the end of the second quarter, BJ’s Restaurants remains on track to open new restaurants in Hagerstown, Maryland and Albany, New York, and two to three additional restaurants in the second half of the year. For fiscal 2018, the company expects to open five to six new restaurants.

Most of the analysts still maintain a “hold” rating on the shares of BJ’s Restaurants, with a growth estimate of 42.60% in the current year and 9% in the next. This year turns out to be more profitable for the company as can be seen from the growth estimates trends.

Related: Darden stock jumps on upbeat quarterly results

Meanwhile, Darden experienced a 41% jump in profit for the fourth quarter driven by a rise in same-restaurant sales, better pricing and different menu-mix. Severe winter weather hindered people from visiting the company’s restaurants that can be seen from a drop in same-restaurant traffic. Darden also announced share repurchase program and raised its quarterly dividend.

The results from Darden seems to be encouraging the investors to invest in the restaurant industry. Healthy menu options remain the primary choice of 70% of the diners, and annual sales in the restaurant industry are $799 billion, according to the National Restaurant Association.

The Association stated that the restaurant operators are more optimistic about sales growth in the coming months despite uncertainty about the overall economy. A majority of them intended for capital expenditures in the coming months.

With the robust future currently forecasted in the food service industry along with Darden’s outlook, it is safe to say that BJ’s Restaurants could be a wise investment option. Shares of BJ’s Restaurants had been trading between $28 and $61.80 for the past 52 weeks.