Wendy's (WEN) Stock Forecast & Price Target

The Wendy's Company is projecting an increase in system sales growth rates for 2025-2027, revised to 2%, 4.6%, and 4.8% respectively, driven by higher international net restaurant growth and positive same-store sales growth. The company's margin expansion is expected to benefit from a greater mix of higher-margin chicken and beverage sales, alongside their ongoing commitment to unit growth with plans for 1,000 new global restaurant openings by FY28. Additionally, Wendy's aims to enhance operational efficiency through the "Model of Excellence," which is anticipated to contribute to sustained margin improvements, with global restaurant level margins expected to rise consistently over the coming years.

The Wendy's Company, while the second-largest quick-service restaurant chain by systemwide sales at $12.6 billion in 2024, faces multiple headwinds that contribute to a negative financial outlook. Key factors include a potential deterioration in macroeconomic conditions, an increasingly competitive landscape, and the company's strategic shift away from value offerings, which may adversely affect customer traffic. Furthermore, projections indicate that Wendy's same-store sales growth and net restaurant growth are likely to underperform relative to management’s guidance through 2025-2028, raising concerns about operational volatility and the company's ability to achieve forecasted margin targets.