On Wednesday, BTIG adjusted its outlook on BurgerFi International Inc. (NASDAQ:BFI), reducing the price target to $2.00 from the previous $3.00, while still endorsing the stock with a Buy rating. The adjustment follows BurgerFi's report of a challenging first quarter marked by significant sales drops within its primary brand and considerable compression of restaurant margins.
BurgerFi's recent performance revealed a tough start to the year, with the company experiencing a double-digit decline in its namesake brand's sales. The fast-casual restaurant chain also faced substantial margin pressures during the period. Despite these setbacks, BTIG remains optimistic that the brand's increased marketing efforts and the launch of a new chicken product line could potentially reverse the downward sales trend.
The firm's analysis acknowledged the disappointing results, which aligned with the company's previous indications of a softer first quarter shared approximately six weeks prior. The financial institution cited the underwhelming beginning of the year, reduced earnings, and a number of system-wide restaurant closures as key factors prompting the price target revision.
In the face of these challenges, BTIG maintains a positive stance on BurgerFi's stock, sustaining a Buy rating despite the lowered price target. The firm's position reflects a belief in the company's capacity to recover and improve sales moving forward, driven by strategic promotional activities and product expansion.
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