Texas Roadhouse Franchise: A Legendary Investment or a Road to Ruin? Let’s Chew on Facts.
Are you looking to enter the restaurant business? Interested in steaks and lively conversations? Get ready, because we’re exploring the Texas Roadhouse franchise. Here’s the truth about whether owning a piece of this steakhouse empire is a smart move or a path to regret.
Round ‘Em Up: Franchise and Ownership Opportunity
Texas Roadhouse has offered franchise opportunities since 1995. They provide you a chance to own a restaurant. Picture it: grilled aroma, lively atmosphere, and you running it. What do you receive? A franchise to operate a restaurant with a specialized menu of steaks, ribs, and drinks.
Show Me the Money: Investment Costs – Hold Your Horses!
Now let’s get down to brass tacks. Opening a Texas Roadhouse isn’t cheap. Initial investment ranges from $4,349,500 to $6,801,500. That’s for a new restaurant. Want to renovate an existing space? That’ll cost $2,647,500 to $5,548,500. Land costs are separate. Remember, land isn’t free.
So, what does the money go towards? For starters, there’s the franchise fee. Each restaurant requires a franchise fee, real estate costs, construction, kitchen equipment, and initial inventory. You’ll also need extra funds for operating expenses. Total estimated initial investment may range from $3.89 million to $7.9 million. Better save those tips.
Cha-Ching! Financial Performance & Profitability – Is There Gold in Them Steaks?
The investment is significant. But what about the returns? Will this leave you richer or in debt? Let’s check the financials.
Texas Roadhouse’s revenue in 2024 reached nearly $5.4 billion. In 2023, sales were $4.78 billion. Clearly, people want that legendary food.
What does each restaurant bring in? Average unit volumes in 2024 exceeded $8 million. That’s per restaurant! Same-store sales for restaurants over a year jumped 8.5% in 2024. Of that growth, 4.4% came from increased customer traffic. More people are coming in and spending money.
Looking ahead, analysts predict positive trends. Projected earnings for 2025 are around $7.02 per share, an estimated 8.5% year-over-year increase. This means a Texas Roadhouse franchise owner might earn roughly $300,000 per year. That’s a number to consider if you’re eyeing a career change.
Historically, Texas Roadhouse’s annual gross profit in 2022 was $0.654 billion, a solid 7.77% increase from the previous year. This indicates consistent growth.
Investing in the Herd: Stock Investment (TXRH) – Giddy Up, Wall Street!
Running a restaurant feels overwhelming? You can still invest in Texas Roadhouse. Buy stock with ticker symbol TXRH. Contact a licensed broker to navigate Wall Street and purchase shares.
Texas Roadhouse gives quarterly earnings announcements in May, August, November, and February. Be sure to mark your calendars.
Who owns TXRH stock? About 19.34% is held by institutional investors. Roughly 28.68% is owned by retail investors. The largest single shareholder is Vanguard.
Is TXRH stock a good investment? It has a Growth Score of A, but a Momentum Score of D. Recent price changes indicate steady growth rather than explosive increases. The PE ratio stood at 26.45 as of March 17, 2025. This shows what investors pay for earnings.
The bottom line? Texas Roadhouse is on a solid growth path. Projections indicate continued positive trends. A long-term investment in TXRH stock might be wise.
Financial Strength: Is Texas Roadhouse Built to Last?
Let’s check Texas Roadhouse’s financials. As of December 2024, total debt was $0.85 billion USD. It’s a large amount but not alarming in restaurant circles. It’s a necessary expense for growth.
Nitty-Gritty Numbers: Other Financial Metrics – Deep in the Weeds
For finance enthusiasts, here’s a number: Cost of Equity is 9.08%. This reflects returns required by investors for Texas Roadhouse stock, aiding in calculating their WACC (Weighted Average Cost of Capital).
Bonus Round: Extra Details – Just the Facts
Want some trivia for your next barbecue? Here they are:
- Texas Roadhouse has over 700 locations nationwide.
- Only about 69 are franchise-owned. Most are company-owned, ensuring quality.
- The state with the most locations? Texas, with 79 restaurants.
- The largest Texas Roadhouse? Lubbock, Texas.
- W. Kent Taylor founded Texas Roadhouse. He envisioned outstanding food and service.
- Their motto? “Legendary food, legendary service.” Simple and effective.
How Does the Competition Stack Up? A Quick Comparison with Other Restaurants.
Now, let’s take a look at the competition to see how Texas Roadhouse compares to others.
other big names in the franchise game:
- McDonald’s Franchise: McDonald’s is the fast-food giant. They have strong brand recognition. The business model works well. Expect a high initial investment to join. Yet, the potential for high returns exists. Some owners make hundreds of thousands each year.
- Chick-fil-A Franchise: Chick-fil-A is famous for chicken. They have loyal customers. The start-up costs are low. You only need $10,000 initial franchise fee. Don’t be misled by the low cost. They have high median sales volume per store. In 2023, it was $21.6 billion system-wide.
- Starbucks License: Want coffee and a business? Starbucks licensing works. The initial investment is steep. It can be $315,000 to over $1 million. Selling lattes is profitable, but starting up is costly.
The Verdict? Texas Roadhouse franchise requires commitment. It needs a solid investment. Financial performance indicates potential for profit. Prepare to shout “yeehaw!” before entering the steakhouse world. It might be great. Or a hard journey. Make your choice wisely.
