Artificial intelligence is at the forefront of all financial discussions this year.
The AI frenzy has made Nvidia Corp. (NASDAQ: NVDA), in fact, into a benchmark by which other stocks’ performance can be measured.
There’s one stock that has outperformed NVDA by 2024, and it’s not even in the tech sector. Enter Brinker International Inc. (NYSE:EAT).
Brinker shares will have more than tripled by 2024
Brinker, a multinational restaurant chain, owns Chili’s Little Italy and Maggiano’s Little Italy. Its share price has risen by a staggering 210% in the past year, compared to 181% for Nvidia.
In a research note published this week, Jonathan Krinsky, an analyst at BTIG, wrote: “Who needs AI if you have baby back ribs?”
Brinker stock will have its best ever year in 2024. If this Dallas-based firm was a part of the S&P 500 index, its stock would be behind only two other names in the list of the best performers year-to date.
Who’s to say EAT won’t also top Vistra and Palantir by the end this year?
Is there still any upside in Brinker stock left?
Brinker stock continues its upward trend this year, backed by strong financials.
The restaurant chain reported a 95-cent share on a $1.14 billion revenue in the latest reported quarter.
Analysts, on the other hand, had instead called for 69 cents a share and $1.10billion.
EAT also raised its full-year revenue guidance to $4.73 billion, which was also higher than Street estimates.
Still, BTIG Analyst Jonathan Krinsky says that it’s time to pull out of Brinker stocks which are now about 90% higher than their 200-day moving mean.
In a recent client note, he said: “We would start to fade this strength and rotate into other restaurants with more timely setups.”
Darden Restaurants Inc. (NYSE: DRI) is one of the names that he recommends as a replacement for EAT.
Darden stock could gain up to 12%
BTIG sees upside in Darden Restaurants up to $195, which indicates a potential gain of about 12% from current levels.
The investment firm expects DRI will benefit from the closure of Red Lobster restaurants.
It argues that increased advertising and favorable comparisons will also help unlock more upside for this stock.
Strategic promotions such as the Never Ending Pasta are also cited as reasons for the bullish outlook.
BTIG believes that Darden’s stock is undervalued, given its consistent performance and growth prospects.
Daren shares are a good investment, especially if you want to create a passive income stream.
They pay a healthy yield of dividends of 3.20%, which makes them well-positioned to weather a possible economic slowdown.
This post This under the radar restaurant stock has outperformed Nvidia by 2024 appeared on The ICD
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