In 2024, shares of chicken-wing chain Wingstop reached record highs above $420, as new flavors and new items like chicken sandwiches propelled sales growth. But today shares of Wingstop are some 60% off those highs, and the stock market’s main chicken-wing trade on Wednesday was showing more signs of breaking down.
Even before the Iran war started and drove gas prices higher, restaurant executives were worried about 2026. Wingstop on Wednesday added to those anxieties, saying higher gas prices due to the conflict had hit demand and caused it to grow more pessimistic about the rest of the year.
“Rapidly rising gas prices stressed the balance sheet of the lower-income consumer that our business overindexes to,” CEO Michael Skipworth said on Wingstop’s earnings call.
Wingstop now expects domestic same-store sales to fall by a low-single digits percentage this year. That’s worse than the forecast executives gave in February, setting a range of flat to up by a percentage in the low single digits. During the first quarter, domestic same-store sales slid 8.7%, worse than analysts had expected.
Skipworth, though, likened consumers’ reactions of late to customer behavior during the period in 2022 when gas prices jumped following the Russian invasion of Ukraine. He said consumers, after initially being scared by those higher fuel prices, began to revert to normal behavior this month.
He also said Wingstop had recently done a better job of attracting wealthier customers — pointing to people who make between $50,000 and $100,000 — and said the restaurant chain didn’t feel the need to get very aggressive on discounting. The chain’s current efforts to market cheaper combo meals and new flavor options, like citrus and hot honey, were working, he said.
Against that backdrop, shares of Wingstop slipped 1% on Wednesday, after occasional positive-territory blips earlier in the day. Shares are down more than 37% over the past 12 months and have recently revisited levels not seen since 2023.
Wingstop’s domestic same-store sales have fallen for the past four quarters, according to FactSet data. However, some analysts saw a silver lining in the chain’s outlook.
D.A. Davidson analyst Matt Curtis, in a note to clients, said the forecast for a same-store-sales decline this year “still implies a significant improvement through the remainder of the year.”
He added that the trend offered “reason for optimism that the first quarter likely represents a bottoming in same-store sales and that comp trends will return to positive territory in the second half of the year as comparisons continue to ease.”
Wingstop reported adjusted earnings of $1.18 a share during the first quarter, above the consensus analyst estimate of $1.03. Revenue of $183.7 million missed the consensus estimate for $187.8 million.
Restaurants over this decade have been dealing with higher food and labor costs, and consumers have been scared away by the resulting menu prices. Chipotle in February offered a cautious outlook, while McDonald’s that same month suggested the year ahead would be difficult, although it said value meals had brought some low-income consumers back.
Not all restaurants have suffered since the Iran war was launched. Starbucks said Tuesday that its turnaround efforts were bringing customers back — and resonating with lower-income and younger shoppers.
