FRGI has increased by 78% compared to the previous year
Fiesta Restaurant Group, Inc. (NASDAQ: FRGI) is a Dallas-based restaurant chain. which owns, operates and franchises the brands Pollo Tropical and Taco Cabana. Fiesta Restaurant Group will post a profit on Thursday May 13th after the close of trading. In 2020, the Fiesta Restaurant Group exceeded earnings expectations in three of its four quarterly reports. But we want to unpack the reactions after the win today.
Only one post-profit reaction has been negative for the past eight quarters. This includes bull gaps after gaining 37.7% and 31.1% in May and August 2020, respectively. Overall, FRGI has seen an average move after gaining 11.3% over the past eight quarters. This time the options market expects an above-average movement after a gain of 19.4%.
On the charts, FRGI is far from the March 9 annual high of $ 18.52. However, the deficit of 15.3% over the past three months has so far been capped by the stock’s 160-day moving average. Year-on-year, the share continued to climb 78.5%.
Basically the Fiesta Restaurant Group has numerous inconsistencies. Aside from fiscal 2020 revenue declining 16% largely due to the COVID-19 pandemic, revenue declined 4% in 2019 before the pandemic took its toll. In addition, the Fiesta Restaurant Group has only posted a profit once in the past four fiscal years. The last time FRGI posted positive net income was in fiscal 2018 when the company reported $ 7.78 million. The following year, FRGI reported a net loss of $ 84.3 million, a decrease in net income of approximately $ 92 million. However, in fiscal 2020, Fiesta Restaurant Group increased its profits by $ 74 million and increased net losses to $ 10.2 million in early 2021.
In general, Fiesta Restaurant Group has yet to prove that it can grow its business and make a profit on a consistent basis. Right now, the risk associated with an investment in FRGI seems to outweigh the potential return, especially after the huge uptrend that Fiesta Restaurant Group shares saw last year.