Red Robin Gourmet Burgers Inc. RRGB announced that it will unveil a restaurant in St. Cloud, MN on Jan 18. The outlet will be located at 3495 West Division St. near the Crossroads Center Mall parking lot, just a stone’s throw away from Barnes and Noble.
Apart from the signature items like Royal Red Robin Burger and Bottomless Steak Fries, the Smoke & Pepper Burger and the Red's Tavern Double, the menu will also feature Freckled Lemonade. The D.G.B., Black & Bleu burger, the Southern Charm Burger will also be served in addition to a variety of salads, entrees, soups and wraps.
The company will celebrate the opening of the restaurant from Jan 18 to 24 and during this week, the company will give away the proceeds from the sale of Freckled Lemonade to the non-profit organization, Alex's Lemonade Stand Foundation.
With the resurgence in consumer confidence, Red Robin plans to accelerate unit openings. The company operates 4,000-square-foot mid-size units and 1,800-square-foot Burger Works apart from the 6,000-square-foot standard Red Robin restaurants. The mid-size units are doing well and the restaurateur expects these to play a crucial role in driving growth.
Burger Works restaurants are a smaller non-traditional prototype with a limited menu and service. These outlets compete with other fast-casual chains that cater to diners who want quality food quickly. By focusing more on its smaller prototype restaurants, Red Robin will be able to accelerate its growth in non-traditional locations and improve return on investment. While lowering costs, these small-sized units enable the company to enter densely populated urban areas.
Moreover, Red Robin is exploring opportunities in untapped domestic markets of Florida, New York, New Jersey, Chicago and Texas. We believe that the company’s plan to accelerate unit growth should boost long-term revenues. Other restaurant chains that are also expanding their foothold in the U.S. are BJ's Restaurants, Inc. BJRI and The Cheesecake Factory Inc. CAKE.
Further, we are encouraged by Red Robin’s initiatives such as menu innovation, effective marketing strategy, unit expansion and remodeling programs, to reinvigorate its brands. We believe that the company is well positioned to sustain the growth momentum on the back of improved guest traffic and innovative offerings.
Red Robin currently carries a Zacks Rank #3 (Hold). A better-ranked stock in the same industry is Carrols Restaurant Group, Inc. TAST, which sports a Zacks Rank #1 (Strong Buy).
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