Wendy's Q4 Preview: Can It Deliver McDonald's‑Level Innovation and Loyalty?

The Wendy's Company (NASDAQ:WEND) reports fourth-quarter financial results Friday before market open. It looks to post a third straight double beat and follow a strong quarterly report from restaurant peer McDonald’s (NYSE:MCD).

Here are the earnings estimates, analyst ratings and key items to watch.

Wendy's Q4 Earnings Estimate

Analysts expect Wendy's to report fourth-quarter revenue of $540.79 million, down from $574.27 million, according to data from Benzinga Pro. The company has beaten revenue estimates in two straight quarters, but missed in six of the last 10 such periods.

Analysts expect Wendy's to report fourth-quarter earnings per share of 15 cents, down from 25 cents a year earlier.

The company has beaten analyst estimates in two straight quarters and in six of the last 10 quarters overall.

Wendy's Analyst Ratings and Price Targets

Analysts have been lowering their price targets on Wendy's ahead of quarterly earnings. Here are some of the latest analyst ratings on Wendy's:

• Citigroup: Maintained Neutral rating, lowered price target from $9 to $8
• Morgan Stanley: Maintained Underweight rating, lowered price target from $9 to $8
• Mizuho: Maintained Underperform rating, lowered price target from $8 to $7

Key Items To Watch In Wendy's Q4 Results

Wendy's results come just days after McDonald's reported quarterly earnings. The global burger chain beat revenue and EPS estimates, reporting a 5.7% year‑over‑year increase in global comparable sales for the quarter, and highlighted its value proposition to consumers.

Wendy's could use its earnings results and call to highlight its value proposition and how it aims to attract new guests, retain loyal customers, and even pull traffic from rivals like McDonald's.

Fourth-quarter results could also see Wendy's highlight some past promotions like 67 cent Frosty's taking advantage of an internet meme, Frosty Day and recent food launches like the Chicken Tenders Ranch Wrap.

While the 67 cent Frosty may have been viewed as a gimmick, the restaurant company offered this price for all customers for one day and had the offer extend for multiple days for loyalty members. The company could show if moves like this helped boost loyalty membership during the quarter.

Wendy's Stock Price Action

Wendy's shares are up 1% to $7.96 on Thursday versus a 52-week trading range of $7.60 to $16.20. The stock is down 44% over the last 52 weeks.

McDonald's stock is up 2% Thursday after its quarterly results. It is up 8.7% over the last 52 weeks and currently trading near all-time highs.

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