Hot Stocks Alert – Luby’s, Inc. (NYSE:LUB),

On Wednesday, Shares of Luby’s, Inc. (NYSE:LUB), lost -1.90% to $3.09. The 52-week range of the share price is from $3.06 – $3.18. The beta value for this stock stands at 0.90 points, while its earnings per share (EPS) was $-048. The company has total market capitalization of $89.75M and a total of 29.04M outstanding shares.

Luby’s, Inc. (LUB) declared unaudited financial results for its twelve-week second quarter fiscal 2017, which ended on March 15, 2017.

Restaurant sales in the second quarter reduced to $81.10M, a decrease of 6.1% as compared to the second quarter fiscal 2016.

Luby’s Cafeterias sales declined $2.90M as compared to the second quarter fiscal 2016, because of the closure of two locations over the prior year and a 4.40% decrease in Luby’s same-store sales. The 4.40% decrease was the result of a 6.60% decrease in guest traffic partially offset by a 2.20% increase in average spends per guest mainly because of a modest price increase and reduced discounting.

Fuddruckers sales at company-owned restaurants reduced $1.70M as compared to the second quarter fiscal 2016, because of six restaurant closings over the prior year and a 1.10% decrease in same-store sales, offset by the opening of three company-owned Fuddruckers locations over the prior year.  The 1.1% decrease in same-store sales was the result of a 2.8% decrease in guest traffic offset by a 3.9% increase in average spends per guest.

Combo location sales reduced $0.30M and represented 6.10% of total restaurant sales in the second quarter. About half of the decline in sales occurred at one Combo location.   Two of the six Combo locations raised sales by 2.2% and 3.4%, respectively.

Cheeseburger in Paradise sales reduced $0.30M, or 7.3%, contrast to a noteworthy prior year same-store sales increase of 4.2%.

Store level profit, defined as restaurant sales plus vending revenue less cost of food, payroll and related costs, other operating expenses, and occupancy costs, was $10.20M, or 12.6% of restaurant sales, in the second quarter contrast to $12.70M, or 14.8% of restaurant sales, during the second quarter fiscal 2016. While cost controls were more efficient in labor scheduling, food cost administration, and certain restaurant operation costs, the lower overall sales volumes led to the decrease in store level profitability.

Culinary Contract Services revenues reduced to $3.30M with 23 operating locations during the second quarter contrast to $3.90M with 28 operating locations during the second quarter fiscal 2016. Culinary Contract Services profit margin rose to 10.50% of Culinary Contract Services sales in the second quarter contrast to 10.2% in the second quarter fiscal 2016.

Franchise revenue raised $119.0 thousand, or 7.0%, in the second quarter contrast to the second quarter fiscal 2016. The increase included (1) an approximate $291.0 thousand increase in non-royalty related fee income in realized franchise development fees, partially offset by (2) an approximate $172 thousand decrease in franchise royalties due in part to the closure of certain franchise locations, lower international royalty income, and same-store sales declines at franchise locations, partially offset by the opening of new franchise locations. In the second quarter, franchisees opened two international locations (in Canada and Panama) and one domestic location (in Nevada). Two locations also closed during the second quarter.

Loss from continuing operations was $12.80M, or a loss of $0.44 per diluted share, contrast to a loss of $0.60M, or a loss of $0.02 per diluted share, in the second quarter fiscal 2016. Apart from special non-cash items, loss from continuing operations was $2.10M, or a loss of $0.07 per diluted share, in the second quarter contrast to a loss of $0.9 million, or a loss of $0.03 per diluted share, in the second quarter fiscal 2016.

Balance Sheet and Capital Expenditures:

We ended the second quarter with a debt balance outstanding of $37.40M, up from $37.0M at the end of fiscal 2016. During the second quarter, our capital expenditures reduced to $3.0 million, contrast to $5.2 million in the second quarter fiscal 2016. At the end of the second quarter, we had $1.4 million in cash and $147.9 million in total shareholders’ equity.

Technical Analysis:

The average true range of the stock is recorded at 0.10 and the relative strength index of the stock stands 37.03. The stock price is going above to its 52-week low with +1.64% and down from its 52-week high with -39.41%.

The stock has shown weekly performance of -4.33% and monthly performance stands at -5.79%. The stock price is trading downbeat from its 200 days moving average with -24.13% and down from 50 days moving average with -7.31%.

Analyst recommendation for this stock stands at 3.00.

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