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Restaurant Chain Portillo's Poised To Attain 10X Unit Count In Next Decade & Expand Nationwide: Analyst

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# Portillo’s Inc (PTLO) Set to Expand 10X and Gain Nationwide Dominance, According to Analyst

![Portillo’s](https://cdn.benzinga.com/files/images/story/2023/11/10/ptlo.png?optimize=medium&dpr=1&auto=webp&height=800&width=1456&fit=crop)

Stephens analyst Joshua Long, in an insightful coverage initiation, has assigned Portillo’s Inc (PTLO) an Overweight rating along with a price target of $20.

Long projects an exceptional upward trajectory for the restaurant chain, envisioning a potential increase of over 10 times its current unit count in the next decade. Impressive early sales volumes have positioned PTLO as a frontrunner in the industry, setting the stage for nationwide expansion.

The prospective cash-on-cash return for PTLO’s new stores is estimated to reach approximately 25% by the third year, derived from an average unit sales figure of around $7.4 million. In addition, the store cash margin is anticipated to be around 22%, while the average cash build-out costs are estimated to be in the range of $6.2 million to $6.5 million.

With only 78 operational units currently, PTLO is eyeing a target of over 920 locations, indicating substantial growth potential. The encouraging performance of new store openings reaffirms the feasibility of the brand’s national expansion.

In terms of financial outlook, Long anticipates FY23 revenue and adjusted EPS to reach $678.0 million and $0.29 respectively, with projected figures for FY24 at $765.9 million in revenue and $0.44 in adjusted EPS.

The long-term forecast suggests low-single-digit growth in same-store sales and a remarkable 12%-15% surge in unit count, ultimately driving a low-double-digit EBITDA growth.

Despite the current 2.75% decline in PTLO shares, trading at $14.44 at the last check on Friday, Long’s analysis paints a promising picture for Portillo’s Inc as it sets the stage for substantial growth in the foreseeable future.

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