Sonic Earnings Preview

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Sonic (NAS: SONC) met its estimates last quarter, but investors hope that it will beat them this quarter. The company will unveil its latest earnings on Wednesday, March 21. Sonic operates and franchises a chain of quick-service drive-in restaurants in the United States.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Sonic with nine of 16 analysts rating it hold. Analysts don't like Sonic as much as competitor Carrols Restaurant Group overall. One out of one analysts rate Carrols Restaurant Group a buy compared to five of 16 for Sonic. Analysts' rating of Sonic has stayed constant from three months prior.
  • Revenue Forecasts: On average, analysts predict $116.5 million in revenue this quarter. That would represent a rise of 2.6% from the year-ago quarter.
  • Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.02 per share. Estimates range from $0.02 to $0.03.

What our community says:
CAPS All-Stars are in strong support of the stock, with 86.7% granting it an "outperform" rating. Most of the community concurs with the All-Stars, with 88.7% awarding it a rating of "outperform." Despite the majority sentiment in favor of Sonic, the stock has a middling CAPS rating of three out of five stars.

Management:
Revenue has fallen in the past two quarters.

Now let's get some insight into how efficient management is at running the business. Margins illustrate how efficiently a company captures portions of sales dollars. For the last two quarters, the company's gross margins have been down year-over-year. Gross margins reflect the total sales revenue retained after costs. Here is how Sonic has been doing for the last four quarters:

Quarter

Q1

Q4

Q3

Q2

Gross Margin

33.2%

35.9%

37.1%

31.3%

Operating Margin

13.1%

18.2%

19%

8.6%

Net Margin

4.3%

8.1%

(3.1%)

3.8%

For all our Sonic-specific analysis, including earnings and beyond, add Sonic to My Watchlist.

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