What Happened?
Shares of fast-food chain Wingstop (NASDAQ: WING) jumped 4.1% in the afternoon session after the company received positive commentary from Morgan Stanley and announced a new marketing partnership with #1 NFL draft pick Cam Ward.
In a note to clients, Morgan Stanley analysts highlighted Wingstop as a bright spot in the restaurant sector, which has been contending with weak industry data and higher food costs. The firm continues to favor the fast-casual chain into next year. Adding to the positive sentiment, Wingstop launched a new promotion for the football season, teaming up with rookie quarterback Cam Ward for a limited-time meal deal. The company is debuting “Cam Ward's #1 Picks” as part of its Ultimate Meal Deals, a strategic move to attract customers during a key sales period.
After the initial pop the shares cooled down to $339.41, up 4.2% from previous close.
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What Is The Market Telling Us
Wingstop’s shares are quite volatile and have had 18 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 6 days ago when the stock dropped 4.1% on the news that markets continued to decline, as investors grew cautious ahead of a key speech by Federal Reserve Chair Jerome Powell. The move came as U.S. equity markets recorded a fifth consecutive day of losses for major indexes like the S&P 500, with technology stocks experiencing the largest declines. Investors have grown wary that the sharp rally in the tech sector since April may have advanced too far. The market-wide caution is largely driven by the upcoming Jackson Hole symposium, a meeting of central bankers, where traders are anxiously awaiting Fed Chair Powell's speech on Friday for guidance on the future path of interest rates.
Wingstop is up 16.3% since the beginning of the year, but at $339.41 per share, it is still trading 20.7% below its 52-week high of $427.92 from September 2024. Investors who bought $1,000 worth of Wingstop’s shares 5 years ago would now be looking at an investment worth $2,050.
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