What Happened: Shares of sushi restaurant chain Kura Sushi (NASDAQ:KRUS) jumped 10.3% in the morning session after the company reported second quarter results that beat analysts' revenue estimates as it opened five new restaurants during the quarter. On the other hand, its EPS missed Wall Street's expectations, but the market doesn't seem to care because the company lifted its full-year revenue guidance after providing it for the first time just last quarter.
Given management's confidence in the business, Kura Sushi is expected to rapidly open new restaurants (it's opened 10 new locations to date) in 2024. Furthermore, the company announced a new project with DoorDash (NASDAQ:DASH) to deliver its meals. Both these facts show it is pursuing a high-growth strategy.
Zooming out, this was a decent quarter, showing that the company is staying on track.
Is now the time to buy Kura Sushi? Find out by reading the original article on StockStory.
What is the market telling us: Kura Sushi's shares are quite volatile and over the last year have had 25 moves greater than 5%. But moves this big are very rare even for Kura Sushi and that is indicating to us that this news had a significant impact on the market's perception of the business.
The biggest move we wrote about over the last year was 3 months ago, when the stock gained 22.7% on the news that the company reported first quarter earnings results that blew past analysts' gross margin expectations. Revenue also came in slightly ahead of Consensus estimates. Looking ahead, full-year revenue guidance came in higher than Wall Street's estimates, partly due to the strong same-store sales growth posted during the quarter. Management highlighted an acceleration in sales momentum, and the business continued to add new restaurants to meet growing demand. On the other hand, its operating profit and EPS missed analysts' expectations. Overall, it was a strong quarter, demonstrating that the company is staying on target.
Kura Sushi is up 50.8% since the beginning of the year, and at $110.52 per share it is trading close to its 52-week high of $119.98 from March 2024. Investors who bought $1,000 worth of Kura Sushi's shares at the IPO in July 2019 would now be looking at an investment worth $5,632.
