XVARY Composite Score
60
/ 100
Average
Combines growth, value, risk, and momentum factors into a single institutional-grade score.
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What it is
Texas Roadhouse runs steakhouse restaurants, sports bars, and burger spots that turned ~$5.88B FY 2025 sales into solid profits.
How it gets paid
Last year Texas Roadhouse made ~$5.88B in revenue. Company-owned Texas Roadhouse was the main engine at $5.01B, or 85% of sales.
Why it's growing
Revenue grew 9.4% last year. We think the operating margin will contract about 160 basis points in the fourth period due to the foodcost inflation and higher labor expenses.
What just happened
Q4 2025 revenue was ~$1.48B; diluted EPS was $1.28.
At a Glance
B++ balance sheet — above average — nothing keeping you up at night
40/100 earnings predictability — expect surprises
28.8x trailing p/e — priced about right
1.8% dividend yield — cash in your pocket every quarter
41.5% return on capital — every dollar works hard here
XVARY composite: 60/100 — average
What They Do
Texas Roadhouse runs steakhouse restaurants, sports bars, and burger spots that turned ~$5.88B FY 2025 sales into solid profits.
You are not buying fancy cuisine. You are buying repeat traffic at 784 restaurants across 49 states and 10 countries. Return on capital is 41.5% (return on capital → profit earned on each dollar invested → this chain turns new stores into cash better than most restaurants).
How They Make Money
~$5.88B
FY 2025 revenue · +9.4% YoY (company release)
Company-owned Texas Roadhouse
$5.01B
Franchised Texas Roadhouse
$0.16B
Bubba's 33
$0.66B
Jaggers
$0.07B
The Products That Matter
Operates company restaurants
Company Restaurants
~$5.88B revenue · +9.4%
this is the business you are buying today: FY 2025 revenue ~$5.88B grew 9.4%, and every cost shock shows up here first.
center of gravity
Collects franchise fees and royalties
Franchise Operations
~$160M · low-single-digit % of total
franchise fees/royalties are a small slice vs. company restaurants— the ~$0.16B row above is the right order of magnitude, not a $1.8B / 30% fiction.
data thin
Key Numbers
41.5%
return on capital
Return on capital → profit earned on money invested → TXRH gets 41.5 cents back for every dollar it puts into the business.
28.8x
trailing p/e
P/E → stock price divided by annual profit per share → you are paying almost 29 years of current earnings for this restaurant chain.
$7.0B
fy2027 revenue
Street models vary— any $7B FY2027 top line needs to be checked against the latest company outlook, not a static feed.
$8.15
fy2027 eps
EPS → profit per share → FY 2025 actual diluted EPS was $6.10; any FY2027 $8+ path is model-dependent— verify against current consensus.
Financial Health
B++
Strength
- balance sheet grade B++ — above average financial health
- risk rank 3 — safer than 50% of stocks
- price stability 70 / 100
- net profit margin 9.1% — keeps 9 cents of every dollar in revenue
- return on equity 42% — $0.42 profit for every $1 investors have put in
B++ — functional but not a standout on the balance sheet.
Total Return vs. Market
You invested $10000 in TXRH 3 years ago → it's now worth $18410.
The index would have given you $13880.
source: institutional data · total return
What Just Happened
missed estimates
Q4 2025 revenue was ~$1.48B (+3.1% YoY); diluted EPS was $1.28 (YoY down— partly 13 weeks vs. 14 in prior-year Q4).
FY 2025 revenue ~$5.88B (+9.4%) and diluted EPS $6.10 (−5.8% YoY) per the Feb 19, 2026 release. Margin math is in the filing— do not mix pre-earnings “expected” EPS bands with the actual print.
~$1.48B
Q4 2025 revenue
$1.28
Q4 diluted EPS
$6.10
FY 2025 diluted EPS
the number that mattered
Restaurant margin dollars in Q4— commodity and wage inflation vs. traffic— decide whether the FY compounder narrative still holds at ~29x trailing earnings.
-
Texas roadhouse’s 2025 fourth-quarter earnings were likely down from a year ago.
-
The company was poised to announce its december-period results as we went to press.
-
Share earnings likely declined about 10% from 2024’s tally driven by a high mid-single-digit increase in food cost inflation.
-
We are looking for earnings per share of between $1.50 and $1.60, versus 2024’s $1.73.note, that the company is also lapping a 14week fourth quarter last year versus the more traditional 13-week period they are facing this year.
-
Although the company took a 1.7% price increase at the beginning of the quarter, we don’t think it will be enough to offset both the lost week, and the higher food costs.we think the operating margin will contract about 160 basis points in the fourth period due to the foodcost inflation and higher labor expenses.
source: Texas Roadhouse Q4/FY 2025 release (Feb 19, 2026) · SEC exhibit 99.1: sec.gov
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What Could Go Wrong
The top threat is traffic slowing while beef and labor costs stay high.
Med
Consumer trade-down
this is still discretionary dining. if households pull back, same-store sales get hit before management gets a chance to fix it with new openings.
with ~$5.88B in annual revenue tied to restaurant traffic, a slowdown does not hide anywhere.
Med
Beef and labor inflation
a 1.7% menu price increase was not expected to fully cover cost pressure, and the fourth-quarter read-through pointed to about 160 basis points of operating margin contraction.
when net margin is only 7.5%, that squeeze matters more than the headline revenue number.
Med
Premium multiple without premium certainty
28.8x trailing earnings is not extreme for a compounding winner, but it is high enough that a few soft quarters can reset the story.
40/100 earnings predictability means you are paying a premium for a business that still throws quarterly curveballs.
~7.5% net margin on ~$5.88B in sales leaves less cushion than the stock's premium valuation implies.
Source: institutional data · regulatory filings · risk analysis
Pay Attention To
Metric
Same-store sales
this is the heartbeat. if traffic and ticket stop growing together, the premium multiple will not be patient.
Risk
Restaurant margin
the catch is margin. the quarter already pointed to about 160 basis points of pressure from food and labor costs.
Calendar
Quarter-length comparisons
last year's fourth quarter had 14 weeks. this one had 13. if you skip that detail, you will misread the comparison.
Trend
Institutional flow
net selling lasted two straight quarters. if that turns, sentiment can help. if it continues, valuation support gets thinner.
Analyst Rankings
short-term outlook
average
momentum score 3 — in human-speak, analysts do not see a strong near-term edge either way.
risk profile
average
stability score 3 means this sits near the middle of the pack on safety. not a bunker. not chaos.
chart momentum
below average
technical score 4 points to softer price action from here. the chart is not doing the bulls any favors.
earnings predictability
40 / 100
that is a low score for a premium multiple. you should expect more quarterly variance than the valuation suggests.
Source: institutional data
Institutional Activity
institutions have been net selling for 2 consecutive quarters — 254 buyers vs. 346 sellers in 3q2025. total institutional holdings: 62.7M shares. net selling for 2 quarters.
Source: institutional data
Price Targets
3-5 year target range
$155
$300
$183
Current price
$228
Target midpoint · +25% from current · 3-5yr high: $385 (+110% · 22% ann'l return)
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