Wendy's (WEN) Stock Forecast & Price Target

Wendy's Company, the second-largest burger quick-service restaurant chain in the U.S. by systemwide sales, is projected to achieve modestly increased system sales growth rates, with estimates of 2%, 4.6%, and 4.8% for 2025 to 2027, driven primarily by international expansion and a strong franchising model, which comprises approximately 94% of its stores. Additionally, the company's margin outlook remains positive, bolstered by a higher mix of sales from profitable chicken and beverage offerings, alongside planned margin enhancements from the integration of efficiency measures under its Model of Excellence initiative. The strategic focus on improving customer experience and service speed, as well as the potential for better-than-expected performance in breakfast offerings and macroeconomic conditions, further underpins a robust growth trajectory for the firm.

The Wendy's Company, while holding a significant position as the second-largest QSR chain in the U.S. with systemwide sales of $12.6 billion in 2024, faces several fundamental challenges contributing to a negative outlook. Key risks include deteriorating macroeconomic conditions, an intensifying competitive landscape, and a strategic pivot away from value offerings, which could adversely impact customer traffic and sales growth. Projections indicate below-trend same-store sales growth and a potential shortfall in long-term sales guidance, coupled with execution issues and leadership changes, further heightening concerns about the company's performance and financial results.