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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#1676
Positioning
Market Dominance
Retail Trade
Restaurants, Hotels, Motels
$11.0B
Gerald L. Morgan
Texas Roadhouse, Inc. was founded in 1993 and is based in Louisville, Kentucky. As of December 28, 2021, it operated 566 domestic restaurants and 101 franchise restaurants.
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Dates updated upon official exchange announcement.
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X-AXIS: EV/EBITDA (LOWER = CHEAPER) | Y-AXIS: ROE (HIGHER = ELITE) | RED CIRCLE = TXRH ANALYSIS TARGET
| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$ARCO Arcos Dorados Holdings Inc. | 73 | 85 | 89 | 65 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$IMKTA INGLES MARKETS INC | 70 | 73 | 89 | 76 | 11.3x | 4.1x | 6.9% | 4.1% | 24.3% | 2.8% | 1.9% | -3.4% | 1.1% | 33.0x | $1.2B | VS | |
$SGU STAR GROUP, L.P. | 69 | 82 | 79 | 63 | - | - | -25.2% | -10.6% | 28.1% | -6.3% | -5.4% | -7.8% | 6.1% | 57.0x | $396M | VS | |
$EZPW EZCORP INC | 68 | 77 | 82 | 89 | 7.2x | 4.2x | 12.0% | 6.2% | 59.1% | 11.6% | 8.5% | 10.5% | 0.0% | 52.0x | $764M | VS | |
$HTHT H World Group Ltd | 68 | 91 | 44 | 84 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$DDL Dingdong (Cayman) Ltd | 68 | 86 | 82 | 57 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$SBH Sally Beauty Holdings, Inc. | 68 | 83 | 92 | 77 | 5.1x | 2.3x | 32.0% | 6.6% | 51.5% | 8.4% | 4.9% | -1.0% | 0.0% | 178.0x | $934M | VS | |
$SPH SUBURBAN PROPANE PARTNERS LP | 67 | 80 | 90 | 53 | - | 13.0x | 0.4% | -3.5% | 61.7% | 2.1% | -5.7% | 2.2% | 7.1% | 190.0x | $1.2B | VS | |
$IHG INTERCONTINENTAL HOTELS GROUP PLC /NEW/ | 67 | 63 | 81 | 67 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$ROST ROSS STORES, INC. | 67 | 63 | 55 | 83 | 25.2x | 16.5x | 34.8% | 13.3% | 28.0% | 11.6% | 9.1% | 10.4% | 1.0% | 26.0x | $51.6B | VS | |
$TXRH Texas Roadhouse, Inc. | 52 | 49 | 43 | 63 | 28.5x | 22.6x | 28.1% | 12.7% | 18.1% | 8.4% | 7.3% | 7.1% | 1.6% | 121.0x | $11.0B | ||
| SECTOR BENCH | - | - | - | - | - | 21.4x | 9.1x | 9.6% | 3.6% | 37.3% | 4.4% | 2.4% | 3.7% | 0.0% | 0.7x | - | REF |
Texas Roadhouse, Inc. (TXRH) receives a "Hold" rating with a composite score of 52.1/100. It ranks #1676 out of 7,333 stocks in our coverage universe and carries a 3-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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Outperforming peers — winners tend to keep winning over 3-12 months
Fair valuation relative to peers
Average quality profile
Low volatility — smoother ride and historically better risk-adjusted returns
Aggressive spending — empire-building risk, dilutive growth
Mid-range overall rating
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Relative valuation derived from Retail Trade sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
Projection based on user-defined inputs. Re-calculated daily against current market data.
Reverse DCF Framework — Mauboussin Methodology
Institutional-grade Reverse DCF analysis. This model identifies the growth hurdles embedded in current market prices. When implied growth is significantly lower than historical or projected rates, a margin of safety may exist. Re-audited daily.
No analyst ratings for TXRH.
View All Ratings| Factor | Global | Sector | Tilt |
|---|---|---|---|
| PROFITABILITY | 49 | 58 | -9DRAG |
| MOMENTUM | 63 | 66 | -3NEUTRAL |
| VALUATION | 43 | 43 | 0NEUTRAL |
| INVESTMENT | 24 | 11 | +13ALPHA |
| STABILITY | 85 | 91 | -6DRAG |
| SHORT INT | 46 | 47 | -1NEUTRAL |
Global = full universe. Sector = relative to industry peers. Positive tilt indicates idiosyncratic strength.
ROE proxy 28.1% (sector 9.6%)
GM 18% vs sector 37%, OM 8% vs sector 4%
Capital turnover N/A
Rev growth 7%, 10yr history
Interest coverage N/A, Net debt/EBITDA -1.1x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
We rate Texas Roadhouse, Inc. (TXRH) as a Hold with a composite score of 52.1/100 at a current price of $180.62. The stock presents a mixed quantitative picture — neither compelling enough to warrant new accumulation nor weak enough to justify selling.
Texas Roadhouse, Inc. holds a top-quartile position (#0 of 50) within the Retail Trade sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 52.1/100 places it at rank #1676 in our full universe.
The near-term outlook is constructive, with revenue growing at 7% and momentum in the 63th percentile confirming positive market sentiment. The combination of strong top-line growth and favorable price dynamics suggests the company is executing well on its growth strategy.
Narrow
Medium
Standard
Fair Value
Returns on equity of 28.1% exceed cost of capital.
Stable competitive position in a defensive sector.
Leverage of 121% D/E amplifies downside risk.
Vulnerability to macroeconomic shocks and interest rate volatility.
Texas Roadhouse, Inc. represents a hold based on multi-factor quantitative performance.
Our model assigns Texas Roadhouse, Inc. a Hold rating, with a composite score of 52.1/100 and 3 out of 5 stars. Ranked #1676 of 7,333 stocks, TXRH presents a mixed quantitative picture — neither compelling enough to initiate new positions nor weak enough to warrant selling. Investors already holding may consider maintaining their position while monitoring for changes in the factor profile.
With a quality score of 49/100, TXRH shows adequate but unremarkable business quality. The company reports a return on equity of 28.1% (sector avg: 9.6%), gross margins of 18.1% (sector avg: 37.3%), net margins of 7.3% (sector avg: 2.4%). This suggests the company generates acceptable returns but may lack the competitive positioning or operational efficiency to stand out from peers.
With a value score of 43/100, TXRH appears somewhat expensive relative to its fundamentals. Key valuation metrics include a P/E ratio of 28.54x, an EV/EBITDA of 22.55x, a P/B ratio of 8.02x. Investors paying a premium here are likely betting on above-average growth or margin expansion to justify current prices.
Texas Roadhouse, Inc.'s investment score of 24/100 suggests limited reinvestment activity. Key growth metrics include revenue growth of 7.1% vs. a sector average of 3.7% and a return on assets of 12.7% (sector: 3.6%). While this can be positive for mature, cash-generative businesses returning capital to shareholders, it may also signal a lack of growth opportunities or management conservatism.
TXRH demonstrates moderate momentum with a score of 63/100, suggesting a neutral price trend without strong directional conviction. Revenue growth stands at 7.1% year-over-year, while a beta of 0.71 reflects its sensitivity to broader market moves. Moderate momentum may indicate the stock is consolidating or transitioning between trends, warranting close monitoring of upcoming catalysts.
Texas Roadhouse, Inc. earns an excellent stability score of 85/100, reflecting low price volatility and a conservatively managed balance sheet. Key stability metrics include a beta of 0.71 and a debt-to-equity ratio of 121.00x (sector avg: 0.7x). Stocks with this level of stability tend to act as portfolio anchors, providing downside protection during market corrections while still participating in broad market advances.
The short interest score of 46/100 for TXRH suggests somewhat elevated bearish positioning by institutional traders. Specific risk factors include elevated leverage (D/E: 121.00x). With a $11.0B market cap (large-cap), Texas Roadhouse, Inc. may experience above-average volatility. Investors should consider whether the short thesis has merit or if it creates a potential short-squeeze opportunity.
TXRH offers a modest dividend yield of 1.6%. While the income contribution is relatively small, even a small dividend signals management's commitment to shareholder returns and can serve as a signal of financial discipline.
Texas Roadhouse, Inc. is a large-cap company in the Retail Trade sector, ranked #0 of 50 in its sector (100th percentile) and #1676 of 7,333 overall (77th percentile). Key comparisons include ROE of 28.1% exceeding the 9.6% sector median and operating margins of 8.4% above the 4.4% sector average. This top-quartile standing reflects exceptional competitive strength relative to Retail Trade peers.
While TXRH currently exhibits a HOLD profile, superior opportunities exist within the RETAIL TRADE sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
View Top Retail Trade Alpha →Quant Factor Profile
Key factor gap
Stability (85) vs Investment (24) — closing this gap could shift the rating.
EV/EBITDA 148% ABOVE SECTOR MEDIAN
ROE 193% ABOVE SECTOR MEDIAN (FAVORABLE)
Gross Margin 52% BELOW SECTOR MEDIAN
Above 50MA
37.18%
Net New Highs
+51081
The article recommends three dividend stocks for long-term income growth: Charles Schwab, experiencing record client assets of $11.59 trillion with strong momentum; Texas Roadhouse, one of few restaurant stocks that performed well in 2025 with 12.8% revenue growth and an 11.5% dividend increase; and Broadcom, an AI chipmaker with a 670% five-year gain and 10% recent dividend hike, benefiting from surging AI chip demand.
McDonald's is highlighted as an attractive dividend stock for passive income investors, with a $40,000 investment potentially generating $1,000 annually. The company is on track to become a Dividend King in 2026 with 49 consecutive years of dividend increases. Despite recent underperformance compared to the S&P 500, McDonald's franchise-heavy business model, international diversification, and expansion plans to 50,000 stores by 2027 make it a stable choice for risk-averse investors seeking quality dividend income.
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Morgan Stanley analyst John Glass maintains Texas Roadhouse (NASDAQ:TXRH) with a Overweight and lowers the price target from $208 to $202.