Breakfast to All at Wendy's Causes Shares to drop as much as 9% on Monday
Wendy's is planning to expand its breakfast segment at a cost of about $20 million in upfront investment. Currently the company features its breakfast menu in 300 locations and now expects to roll out the offerings to all of its locations by the end of 2020. Filings show Wendy's had 5,810 locations in the US by the end of 2018.
The Monday afternoon announcement says the expansion could result in a hire of an additional 20,000 employees. Todd Penegor, Wendy's CEO, said this should bring "incredible growth opportunities" as it caters to a morning-focused fast food customer.
"We are well-positioned to pursue it. We believe we have the right team and structure in place, and we put Wendy's fan favorites on our breakfast menu to set us apart from the competition," Penegor said in a company statement.
The restaurant chain expects adjusted earnings per share to drop by 3.5% to 6.5%, after previously estimating the metric to grow between 3.5% and 7%. Wendy's announced it will give an update on its 2020 objectives during its October 11 investor meeting. Shares closed at $21.95 per share Monday, up nearly 41% year-to-date.
Analysts seem mixed about the strength and value of Wendy's with 13 giving it a "buy" ratings, 14 giving it a "hold" ratings, and one suggesting to "sell".