Wingstop Inc. (WING) Bundle
A Brief History of Wingstop
Wingstop Inc. has established itself as a prominent player in the fast-casual dining segment, particularly in the chicken wing market. As of 2024, the company operates 2,458 restaurants globally, marking a substantial increase from the previous year.
Financial Performance
For the thirty-nine weeks ended September 28, 2024, Wingstop reported total revenue of $463.99 million, a 39.3% increase from $333.0 million in the comparable period in 2023. This surge was driven by various factors, including robust same-store sales growth and the expansion of its restaurant footprint.
| Metric | 2024 (39 Weeks) | 2023 (39 Weeks) | Increase (%) |
|---|---|---|---|
| Total Revenue | $463.99 million | $333.0 million | 39.3% |
| Net Income | $81.96 million | $51.36 million | 59.6% |
| Adjusted EBITDA | $155.71 million | $107.42 million | 45.0% |
| System-wide Sales | $3.53 billion | $2.52 billion | 40.4% |
Key Growth Drivers
Wingstop's growth has been significantly supported by its franchise model, which has seen 244 net new openings in 2024. Domestic same-store sales increased by 23.6% year-over-year, reflecting the brand's strong market presence and customer loyalty.
Cost Structure
The company's cost of sales for the thirty-nine weeks ended September 28, 2024, was $68.31 million, representing 76.1% of total revenue. Notably, food, beverage, and packaging costs increased due to rising prices of bone-in chicken wings, which saw a 41.5% price increase compared to the previous year.
| Cost Component | 2024 (39 Weeks) | 2023 (39 Weeks) | Percentage of Company-Owned Sales |
|---|---|---|---|
| Food, Beverage, and Packaging Costs | $32.19 million | $22.66 million | 35.9% |
| Labor Costs | $21.02 million | $16.68 million | 23.4% |
| Other Operating Expenses | $17.44 million | $13.28 million | 19.4% |
Market Position and Strategic Initiatives
Wingstop continues to focus on enhancing its technology and operational efficiency. The company has invested significantly in its MyWingstop technology platform, which aims to improve customer engagement and streamline operations.
Stock Performance and Shareholder Returns
As of September 28, 2024, Wingstop's stock has seen notable fluctuations, with a share repurchase program authorized for up to $250 million. The company repurchased 169,479 shares at an average price of $377.09 per share during the thirty-nine weeks ended September 28, 2024.
| Share Repurchase Program | Authorized Amount | Shares Repurchased | Average Price per Share |
|---|---|---|---|
| 2024 | $250 million | 169,479 | $377.09 |
Overall, Wingstop's operational strategies, robust financial performance, and expansion initiatives position it favorably in the competitive fast-casual dining market.
A Who Owns Wingstop Inc. (WING)
Major Shareholders
As of 2024, Wingstop Inc. (WING) has a diverse ownership structure consisting of institutional and retail investors. The largest shareholders include:
- BlackRock, Inc. - 10.5% ownership
- The Vanguard Group, Inc. - 9.8% ownership
- Wellington Management Company, LLP - 8.2% ownership
- FMR LLC (Fidelity Investments) - 7.4% ownership
- State Street Corporation - 5.5% ownership
Insider Ownership
Insider ownership is also notable, with key executives and board members holding significant shares:
- Charlie Morrison (CEO) - 1.2% ownership
- Michael Skipworth (President) - 0.8% ownership
- Other executives and board members - 1.5% combined ownership
Institutional Ownership
Institutional investors hold approximately 75% of Wingstop's total shares, reflecting strong institutional confidence in the company's future growth prospects.
Stock Performance
As of September 2024, Wingstop's stock price has increased by approximately 28% year-to-date, reflecting robust financial performance and positive market sentiment.
Recent Financial Highlights
In the third quarter of 2024, Wingstop reported:
- Total Revenue: $464 million, a 39.3% increase year-over-year
- Net Income: $82 million, up 59.6% from the prior year
- Adjusted EBITDA: $155.7 million, a 45% increase year-over-year
- System-wide Sales: $3.5 billion, up 40.4% compared to the previous year
Shareholder Voting Power
The voting rights associated with shares are typically one vote per share, providing significant influence to major shareholders in corporate decision-making.
| Shareholder | Ownership (%) | Type |
|---|---|---|
| BlackRock, Inc. | 10.5% | Institutional |
| The Vanguard Group, Inc. | 9.8% | Institutional |
| Wellington Management Company, LLP | 8.2% | Institutional |
| FMR LLC (Fidelity Investments) | 7.4% | Institutional |
| State Street Corporation | 5.5% | Institutional |
| Charlie Morrison (CEO) | 1.2% | Insider |
| Michael Skipworth (President) | 0.8% | Insider |
| Other executives and board members | 1.5% | Insider |
Dividends
Wingstop has declared a quarterly dividend of $0.27 per share in Q3 2024, totaling approximately $7.9 million to be paid on December 6, 2024.
Share Repurchase Program
As of September 28, 2024, Wingstop has repurchased 169,479 shares at an average price of $377.09 per share, with $61.1 million remaining under its share repurchase authorization of $250 million.
Wingstop Inc. (WING) Mission Statement
Wingstop Inc. aims to serve the world flavor through an unparalleled guest experience and an offering of classic wings, boneless wings, tenders, and chicken sandwiches, all cooked to order and hand-sauced-and-tossed in 12 bold, distinctive flavors. The company operates primarily as a franchisor, with approximately 98% of Wingstop’s restaurants owned and operated by independent franchisees. This asset-light model generates strong operating margins and requires low capital expenditures, creating stockholder value through consistent free cash flow and capital-efficient growth.
Financial Overview
As of September 28, 2024, Wingstop reported significant increases in key financial metrics compared to the previous year:
| Metric | 2024 | 2023 | Increase ($) | Increase (%) |
|---|---|---|---|---|
| Total Revenue | $464.0 million | $333.0 million | $131.0 million | 39.3% |
| Net Income | $81.964 million | $51.361 million | $30.603 million | 59.6% |
| Adjusted EBITDA | $155.7 million | $107.4 million | $48.3 million | 45.0% |
| System-wide Sales | $3.532 billion | $2.516 billion | $1.016 billion | 40.4% |
| Domestic Same Store Sales Growth | 23.6% | 17.3% | 6.3% | 36.4% |
| Number of System-wide Restaurants | 2,458 | 2,099 | 359 | 17.1% |
Key Performance Indicators
For the thirteen weeks ended September 28, 2024, Wingstop's performance indicators are as follows:
| Key Performance Indicator | 2024 | 2023 | Increase (%) |
|---|---|---|---|
| System-wide Sales | $1.233 billion | $885.045 million | 39.3% |
| Domestic Restaurant Average Unit Volume (AUV) | $2.116 million | $1.755 million | 20.6% |
| Domestic Same Store Sales Growth | 20.9% | 15.3% | 36.5% |
| Company-owned Same Store Sales Growth | 7.3% | 6.0% | 21.7% |
Operational Highlights
During the thirty-nine weeks ended September 28, 2024, Wingstop achieved the following operational milestones:
- 244 net new restaurant openings.
- Digital sales accounted for 69.0% of system-wide sales, up from 66.9% in the prior year.
- Advertising expenses totaled $172.7 million, an increase of $52.0 million compared to $120.8 million in the comparable period in 2023.
Cost Structure
In terms of cost management, the following data outlines key components of Wingstop's cost of sales for the thirty-nine weeks ended September 28, 2024:
| Cost Component | 2024 ($ thousands) | 2023 ($ thousands) | Increase ($ thousands) | Increase (%) |
|---|---|---|---|---|
| Food, Beverage and Packaging Costs | $32,186 | $22,661 | $9,525 | 42.1% |
| Labor Costs | $21,017 | $16,683 | $4,334 | 26.0% |
| Other Restaurant Operating Expenses | $17,438 | $13,278 | $4,160 | 31.4% |
| Total Cost of Sales | $68,311 | $50,959 | $17,352 | 34.1% |
Liquidity and Capital Resources
As of September 28, 2024, Wingstop reported cash and cash equivalents of $84.0 million. The company expects cash flows from operations, combined with its securitized financing facility, to meet its capital expenditure and working capital requirements for the foreseeable future.
Net cash provided by operating activities for the thirty-nine weeks ended September 28, 2024, was $149.868 million, an increase of $66.121 million from $83.747 million in the prior year period.
How Wingstop Inc. (WING) Works
Business Model
Wingstop operates primarily as a franchisor, with approximately 98% of its restaurants being owned and operated by independent franchisees. This asset-light model allows for strong operating margins and low capital expenditures, contributing to consistent free cash flow and capital-efficient growth.
Financial Performance Overview
For the thirty-nine weeks ended September 28, 2024, Wingstop reported:
- Total revenue of $464.0 million, an increase of 39.3% from $333.0 million in the prior year.
- Net income of $81.964 million, or $2.78 per diluted share, compared to $51.361 million or $1.71 per diluted share in the prior year, marking a 59.6% increase.
- Adjusted EBITDA of $155.7 million, up 45.0% from $107.4 million year-over-year.
Quarterly Highlights
In the third quarter of 2024, Wingstop achieved:
- Total revenue of $162.5 million, a 38.8% increase over $117.1 million from the prior year.
- Net income of $25.732 million, up 31.9% from $19.511 million.
- Domestic same store sales growth of 20.9%.
- 244 net new openings year-to-date, totaling 2,458 system-wide restaurants.
Revenue Breakdown
The breakdown of revenue sources for the thirty-nine weeks ended September 28, 2024, is as follows:
| Revenue Source | Amount (in thousands) | Increase/Decrease (in thousands) | Percentage Change |
|---|---|---|---|
| Royalty revenue, franchise fees, and other | $212,652 | $63,280 | 42.4% |
| Advertising fees | $161,567 | $47,557 | 41.7% |
| Company-owned restaurant sales | $89,767 | $20,151 | 28.9% |
| Total Revenue | $464,000 | $130,988 | 39.3% |
Cost of Sales
For the thirty-nine weeks ended September 28, 2024, the components of cost of sales were:
| Cost Component | Amount (in thousands) | Percentage of Company-Owned Restaurant Sales |
|---|---|---|
| Food, beverage, and packaging costs | $32,186 | 35.9% |
| Labor costs | $21,017 | 23.4% |
| Other restaurant operating expenses | $17,438 | 19.4% |
| Total cost of sales | $68,311 | 76.1% |
Key Performance Indicators
Key metrics for the thirteen and thirty-nine weeks ended September 28, 2024, include:
| Metric | Thirteen Weeks Ended | Thirty-Nine Weeks Ended |
|---|---|---|
| System-wide restaurants open | 2,458 | 2,458 |
| System-wide sales | $1,233,373 | $3,532,891 |
| Domestic restaurant AUV | $2,116 | $2,116 |
| Domestic same store sales growth | 20.9% | 23.6% |
| Company-owned domestic same store sales growth | 7.3% | 9.1% |
Liquidity and Capital Resources
As of September 28, 2024, Wingstop reported:
- Cash and cash equivalents of $84.0 million.
- Net cash provided by operating activities was $149.868 million, an increase from $83.747 million in the prior year.
- Net cash used in investing activities was $50.123 million, up from $33.499 million in the prior year.
- Net cash used in financing activities was $88.285 million, down from $149.017 million in the prior year.
Debt Obligations
As of September 28, 2024, Wingstop's long-term debt consisted of:
- 2020-1 Class A-2 Senior Secured Notes: $472.800 million
- 2022-1 Class A-2 Senior Secured Notes: $248.125 million
- Total debt: $713.729 million
Dividends and Share Repurchase Program
During the thirty-nine weeks ended September 28, 2024:
- Dividends declared totaled $20.8 million, or $0.71 per share.
- Share repurchase program authorized for up to $250 million.
How Wingstop Inc. (WING) Makes Money
Revenue Sources
Wingstop Inc. generates revenue primarily through three main channels:
- Royalty revenue from franchised restaurants
- Advertising fees collected from franchisees
- Sales from company-owned restaurants
Royalty Revenue
In the thirty-nine weeks ended September 28, 2024, Wingstop reported royalty revenue of $212.7 million, an increase of 42.4% from $149.4 million in the previous year. This growth was primarily driven by:
- Domestic same-store sales growth of 23.6%
- Net new franchise development contributing $20.2 million
Advertising Fees
Advertising fees increased significantly, reaching $161.6 million for the thirty-nine weeks ended September 28, 2024, up 41.7% from $114.0 million in 2023. This increase was attributed to:
- A 40.4% increase in system-wide sales
- An increase in the national advertising fund contribution rate from 5.0% to 5.3%
Company-Owned Restaurant Sales
Company-owned restaurant sales totaled $89.8 million for the thirty-nine weeks ended September 28, 2024, a rise of 28.9% from $69.6 million in the previous year. This was driven by:
- Same-store sales growth of 9.1%
- The addition of ten net new company-owned restaurants
Cost Structure
The cost structure for Wingstop includes several key components:
| Cost Item | Thirty-Nine Weeks Ended September 28, 2024 (in $ thousands) | Thirty-Nine Weeks Ended September 30, 2023 (in $ thousands) | Change ($ thousands) | Percentage Change (%) |
|---|---|---|---|---|
| Cost of Sales | $68,311 | $50,959 | $17,352 | 34.1% |
| Advertising Expenses | $172,705 | $120,753 | $51,952 | 43.0% |
| Selling, General and Administrative | $85,569 | $68,820 | $16,749 | 24.3% |
| Depreciation and Amortization | $13,625 | $9,591 | $4,034 | 42.1% |
Net Income and Profitability
For the thirty-nine weeks ended September 28, 2024, Wingstop's net income was $82.0 million, compared to $51.4 million in the previous year, marking a 59.6% increase. Earnings per share for this period were $2.78 compared to $1.71 in the prior year.
Digital Sales and Growth Initiatives
Digital sales have become a significant portion of Wingstop's revenue, accounting for 69.0% of system-wide sales in the third quarter of 2024, an increase from 66.9% in the previous year. The company has opened 244 new restaurants year-to-date, contributing to total system-wide sales of $3.5 billion, a 40.4% increase year-over-year.
Key Performance Indicators
| Indicator | Value as of September 28, 2024 | Value as of September 30, 2023 |
|---|---|---|
| Number of System-Wide Restaurants | 2,458 | 2,099 |
| System-Wide Sales (in $ thousands) | $3,532,891 | $2,516,427 |
| Domestic Restaurant AUV (Annual Unit Volume) | $2,116,000 | $1,755,000 |
| Domestic Same Store Sales Growth | 23.6% | 17.3% |
Financial Health and Liquidity
As of September 28, 2024, Wingstop reported cash and cash equivalents of $84.0 million. The net cash provided by operating activities was $149.9 million, an increase of $66.1 million from $83.7 million in the prior year.
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Article updated on 8 Nov 2024
Resources:
- Wingstop Inc. (WING) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Wingstop Inc. (WING)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Wingstop Inc. (WING)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.