Red Robin (RRGB) Set to Launch 2 Outlets, Expand Footprint

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Red Robin Gourmet Burgers, Inc.RRGB plans to open two new Red Robin Gourmet Burgers and Brew restaurants on Feb 6, 2017. One of the outlets will be in Vestal, NY, located at 2545 Vestal Parkway East in front of Town Square Mall. The other outlet will be in Pickerington, OH, located at 1720 Hill Road N., off Route 256 in front of the Marcus Pickerington movie theater.

Apart from the signature items like Royal Red Robin Burger, Bottomless Steak Fries, Smoke & Pepper Burger, and the Red's Tavern Double, the menu will also feature Freckled Lemonade. Moreover, the restaurants will serve D.G.B., Black & Bleu Burger, The Marco Pollo, the Southern Charm Burger, along with a variety of salads, entrees, soups and wraps.

Currently, there are more than 550 Red Robin restaurants across the U.S. and Canada. However, Red Robin loses out in terms of international presence. Whereas other restaurateurs like Yum! Brands, Inc. YUM , McDonalds Corporation MCD and Papa John's International, Inc. PZZA are following aggressive global expansion policies, Red Robin seems to be weak on this front.

After a dismal first half of 2016, the company has undertaken various initiatives that have begun to show signs of improvement in the recent months. Investors have already started noticing the potential of the company, as shares have started to gain momentum, outpacing the industry's growth at large. Over the past three months, the stock has returned 9% compared with the industry's gain of 1.2%.

To conclude, Red Robin is facing numerous headwinds including a sluggish sales environment and higher labor as well as pre-opening and remodeling costs. Nevertheless, we believe that the company's efforts to expand its footprint through accelerated unit growth will boost revenues.

Moreover, we expect this Zacks Rank #3 (Hold) company's initiatives such as menu innovation, focus on increasing speed of service, effective marketing strategy and remodeling programs to further drive growth.

You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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