First Watch Restaurant Group (NASDAQ:FWRG – Get Free Report) released its earnings results on Tuesday. The company reported $0.04 earnings per share for the quarter, missing the consensus estimate of $0.05 by ($0.01), FiscalAI reports. The company had revenue of $354.67 million during the quarter, compared to the consensus estimate of $351.57 million. First Watch Restaurant Group had a return on equity of 2.85% and a net margin of 1.38%.First Watch Restaurant Group’s revenue for the quarter was up 15.2% on a year-over-year basis. During the same period in the previous year, the firm posted $0.03 EPS.
Here are the key takeaways from First Watch Restaurant Group’s conference call:
- Second-quarter revenue rose 15.2% to $354.7 million, driven by 3.4% same-restaurant sales growth and continued contributions from new locations. Same-restaurant traffic was nearly flat but improved 160 basis points sequentially, turning positive in June.
- Marketing investments, menu innovation, and seasonal offerings are generating traction. Unaided brand awareness increased more than 50% since early 2025, while 17% of customers acquired through targeted campaigns have already returned for a second visit.
- First Watch opened 18 restaurants in the quarter and said its 2025 and 2026 new-restaurant classes are outperforming both existing units and underwriting targets. The company maintains a pipeline of more than 100 projects and expects to reach approximately 2,200 potential U.S. locations over time.
- Strong demand for premium beef offerings increased food costs by nearly 100 basis points year over year and led management to lower 2026 adjusted EBITDA guidance to $133 million-$136 million. The company expects the margin pressure to moderate after the current limited-time offering ends.
- Beginning in 2027, First Watch will target about 50 company-operated openings annually instead of maintaining a higher unit-growth rate, prioritizing self-funded expansion, balance-sheet strengthening, and positive free cash flow. Updated long-term targets call for 2%-4% same-restaurant sales growth, 10%-13% revenue growth, and 11%-14% adjusted EBITDA growth.
First Watch Restaurant Group Stock Up 0.2%
NASDAQ:FWRG traded up $0.02 during trading hours on Wednesday, hitting $12.82. 306,786 shares of the stock traded hands, compared to its average volume of 1,494,750. The firm has a 50 day moving average price of $12.05 and a 200 day moving average price of $12.83. The firm has a market cap of $790.35 million, a price-to-earnings ratio of 45.79, a PEG ratio of 7.41 and a beta of 1.03. First Watch Restaurant Group has a fifty-two week low of $9.97 and a fifty-two week high of $19.53. The company has a current ratio of 0.29, a quick ratio of 0.25 and a debt-to-equity ratio of 0.43.
Key Stories Impacting First Watch Restaurant Group
- Positive Sentiment: First Watch reported second-quarter revenue of $354.7 million, up 15.2% year over year and ahead of the approximately $351.6 million consensus estimate. Same-restaurant sales increased 3.4%, indicating continued customer demand. First Watch Restaurant Group Reports Q2 2026 Financial Results
- Positive Sentiment: The company opened 18 system-wide restaurants across 15 states during the quarter and outlined a plan to sustain approximately 50 company-operated openings annually beginning in 2027. This supports a longer-term unit-growth story and could expand the revenue base. First Watch outlines 2027 restaurant opening plan
- Positive Sentiment: First Watch generated $34.5 million of adjusted EBITDA in the quarter and guided full-year 2026 adjusted EBITDA to $133 million-$136 million. Full-year revenue guidance was approximately $1.4 billion, broadly consistent with analyst expectations. First Watch 2026 guidance
- Neutral Sentiment: Net income was $2.3 million, while management’s earnings call emphasized continued restaurant expansion and operating performance. Investors will likely focus on whether sales growth can translate into stronger bottom-line results as the company adds locations. First Watch Q2 2026 earnings call transcript
- Negative Sentiment: Quarterly adjusted earnings were $0.04 per share, below the roughly $0.05-$0.06 analyst estimate, although up from $0.03 a year earlier. The miss may limit the positive impact of the revenue beat, particularly given the company’s modest 1.38% net margin. First Watch misses Q2 earnings estimates
Wall Street Analyst Weigh In
A number of equities analysts recently commented on the company. DA Davidson reiterated a “buy” rating and issued a $17.00 price target on shares of First Watch Restaurant Group in a research note on Tuesday, April 28th. Freedom Capital raised First Watch Restaurant Group to a “strong-buy” rating in a report on Wednesday, July 1st. Benchmark decreased their target price on First Watch Restaurant Group from $24.00 to $22.00 and set a “buy” rating for the company in a research report on Monday, April 20th. Wall Street Zen downgraded First Watch Restaurant Group from a “sell” rating to a “strong sell” rating in a report on Saturday, July 18th. Finally, Stifel Nicolaus set a $14.00 price target on First Watch Restaurant Group in a research report on Tuesday, May 5th. One analyst has rated the stock with a Strong Buy rating, eight have given a Buy rating, one has issued a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat, First Watch Restaurant Group currently has an average rating of “Moderate Buy” and a consensus price target of $18.78.
Check Out Our Latest Report on First Watch Restaurant Group
Institutional Inflows and Outflows
Several large investors have recently bought and sold shares of the business. Woodline Partners LP purchased a new stake in First Watch Restaurant Group in the 3rd quarter worth about $20,318,000. The Manufacturers Life Insurance Company increased its holdings in shares of First Watch Restaurant Group by 51.7% in the 2nd quarter. The Manufacturers Life Insurance Company now owns 2,335,883 shares of the company’s stock valued at $37,468,000 after purchasing an additional 796,191 shares during the period. Balyasny Asset Management L.P. increased its holdings in shares of First Watch Restaurant Group by 2,796.3% in the 3rd quarter. Balyasny Asset Management L.P. now owns 813,051 shares of the company’s stock valued at $12,716,000 after purchasing an additional 784,979 shares during the period. Fred Alger Management LLC lifted its position in shares of First Watch Restaurant Group by 183.9% in the fourth quarter. Fred Alger Management LLC now owns 1,036,560 shares of the company’s stock worth $15,631,000 after purchasing an additional 671,455 shares in the last quarter. Finally, Millennium Management LLC lifted its position in shares of First Watch Restaurant Group by 2,382.9% in the third quarter. Millennium Management LLC now owns 696,053 shares of the company’s stock worth $10,886,000 after purchasing an additional 668,019 shares in the last quarter. 96.11% of the stock is owned by institutional investors and hedge funds.
First Watch Restaurant Group Company Profile
First Watch Restaurant Group, Inc (NASDAQ: FWRG) operates a specialty daytime dining concept focused on breakfast, brunch and lunch. The company’s casual, full-service cafés emphasize fresh ingredients, made-to-order entrées and a seasonally driven menu that ranges from omelets and Benedicts to salads, skillets and afternoon sandwiches. First Watch positions itself as a daytime-only destination, with most locations opening early morning and closing by mid-afternoon.
Founded in 1983 by Ken Pendery and John Sullivan in Pacific Grove, California, First Watch began as a single café and gradually expanded through company-owned and select franchised locations.
Featured Stories
- Five stocks we like better than First Watch Restaurant Group
- 3 Stocks That Prove the AI Trade Isn’t Over, It Moved
- The FTC Is Suing Hims & Hers Health—Here’s Why Investors Shouldn’t Panic
- 3 Stocks Taking Very Different Routes Through the Summer Rally
- Is ADM’s Rally Getting Ahead of Its Policy Tailwind?
Receive News & Ratings for First Watch Restaurant Group Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for First Watch Restaurant Group and related companies with MarketBeat.com's FREE daily email newsletter.
