What Happened?
Shares of burger restaurant chain Red Robin (NASDAQ: RRGB) fell 7.9% in the afternoon session after it gave back a portion of the prior session's rally as investors looked past the company's better-than-expected third-quarter results and refocused on its long-term challenges. The burger chain had initially surged nearly 14% after reporting revenue of $265.1 million and an adjusted loss per share of $0.70, both of which beat Wall Street estimates. However, the subsequent decline suggests a more sober assessment of the company's health. The report still highlighted a 3.5% year-over-year revenue decline and a 1.2% drop in same-store sales.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Red Robin? Access our full analysis report here.
What Is The Market Telling Us
Red Robin’s shares are extremely volatile and have had 59 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 5 days ago when the stock gained 7.8% on the news that the company released selected preliminary financial results for its third fiscal quarter of 2025 and announced leadership changes. In a press release, the company described its early, unaudited financial performance for the period. At the same time, Red Robin announced that its Chief Financial Officer, Todd Wilson, would depart effective December 12, 2025. The company also promoted Jesse Griffith to Chief Operations Officer. The stock's positive movement suggested investors reacted favorably to the preliminary earnings guidance, viewing it as more significant than the executive shuffle.
Red Robin is down 23.5% since the beginning of the year, and at $4.34 per share, it is trading 41.7% below its 52-week high of $7.44 from July 2025. Investors who bought $1,000 worth of Red Robin’s shares 5 years ago would now be looking at an investment worth $254.10.
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