Portillo's finally having a moment

Wiping the dust off the ol’ primal scream/Vincero thread, in honor of PTLO (finally) being up for once. Thanks to dumpster-diving at lows last week, I am immensely enjoying today.

Of course, this probably jinxes it…but shush you! Just enjoy the moment.

Imagine “Vincero” as “Portillo”

C’mon…do it with me now. Let out that primal scream.
You know you want to.


Or go old school:
https://youtu.be/6R5-FXVHruQ (I like Paul Potts, starting around 8:04 mark)
https://youtu.be/Kg3aiEiK_PU (Double dose of Pavarotti near the end of this one)

Dreamer ← enjoying some green at moment.


Of course…PTLO has to lay a bit of an egg the following day.
Que sera sera.

In other news - am sure glad I exited AEHR before Team Saul set fire to it and dropped it out of a high-altitude plane into freezing and shark-infested waters. Nothing quite like a former Saul stock after-thought. Sometimes they come back though…like Pet Semetary.

maybe we finish day strong. will see.


Market down?

That’s ok…PTLO up!

POMO + PTLO = pure awesomeness!


PTLO ER day.
Guessing it plummets, but will see.

There is not a lot that will/should surprise me with their ER’s.
Need to hear that:
New restaurants openings planned / expansion continues on track
Those newer restaurants perform well at open and continue/sustain success at the level that their average restaurant produces.
Existing restaurants simply need to hold their ground. I am not looking for growth from existing, but rather from expansion over time.
Are they keeping costs controlled as much as they can, without driving away client base with increased prices.
Their PE parent, Berkshire Partners, should continue to divest their Class B shares over time and get out of the picture completely. This is fine, but don’t want to see shenanigans that shouldn’t be happening.

So on a real meaningful dip back to any new ATL’s, would look to add and ride back up. Rinse/repeat.

Idea is that eventually the expansion gets more newsworthy to investing community, as their brand recognition grows, and stock price and market cap, along with increased rev/profits, should all be up and to the right.

This is a long-term play, and not a get-rich-quick approach, although any oversold reactions and overbought reactions could be useful in a trading-around-the-edges motion around any core shares that I just truly LTBH.

Financial Highlights for the Third Quarter 2023 vs. Third Quarter 2022:

  • Total revenue increased 10.4% or $15.7 million to $166.8 million;
  • Same restaurant sales increased 3.9%;
  • Operating income increased $4.5 million to $15.1 million;
  • Net income increased $3.3 million to $6.5 million;
  • Restaurant-Level Adjusted EBITDA* increased $7.8 million to $41.9 million; and
  • Adjusted EBITDA* increased $5.7 million to $27.3 million.

They have ER conf call at 9am CST


from same press release:

We believe unit growth is a key driver of shareholder value creation. During the quarter ended September 24, 2023, we opened two new restaurants, one restaurant in Arizona and our second location in Texas for a total of 78 restaurants, including a restaurant owned by C&O, of which Portillo’s owns 50% of the equity. The one restaurant opened in the fourth quarter of 2022 and six restaurants opened during the three quarters ended September 24, 2023 positively impacted revenues by approximately $11.0 million and $31.5 million in the quarter and three quarters ended September 24, 2023, respectively. We opened one restaurant subsequent to September 24, 2023 and plan to open five additional restaurants in the fourth quarter of 2023.

The $0.5 million decrease in interest expense was primarily driven by the improved lending terms associated with our 2023 Term Loan and 2023 Revolver Facility.

Restaurant-Level Adjusted EBITDA* for the third quarter ended September 24, 2023 was $41.9 million compared to $34.1 million for the third quarter ended September 25, 2022, an increase of $7.8 million or 22.9%.

Adjusted EBITDA* for the third quarter ended September 24, 2023 was $27.3 million compared to $21.6 million for the third quarter ended September 25, 2022, an increase of $5.7 million or 26.2%.

Below are the restaurants opened since the beginning of fiscal 2023:

Location Opening Date
Kissimmee, Florida December 2022
The Colony, Texas January 2023
Tucson, Arizona February 2023
Gilbert, Arizona March 2023
Queen Creek, Arizona August 2023
Allen, Texas August 2023
Cicero, Illinois October 2023

one analyst on Q&A seemed to be trying to draw out a negative answer from CEO, but he wasn’t biting.

Basically it was “hey…is traffic slowing, and why?”

Answer seems to be Chicago is a shrinking population (I could see that in the city, but not suburbs, where most Portillos locations are) and that they purposely are choosing states/locations with population growth trends that are positive (TX, FL, AZ, etc)

Related to my socialist rant in another thread about restaurants always raising prices to satisfy wall street. I always like that PTLO CEO states they want to remain consumer-friendly as much as possible. So they “could” raise prices more but purposely are trying not to.

The growth will come from new locations/expansion of new store openings.


Might just be the fact that it seems to be an irrational “UP” day, but the dip in PTLO didn’t last long, as already slightly up.

Oh well. I missed buying more, as my limit order was too low.
The day is young though.

CEO and CFO are confident and saying all the right things, from my perspective.


yes crazy day! PTLO misses in revenue and jumped as high as $16 a share.

Elf beats and raises and is down 4%. looks like the Saul board didn’t like the report


some Portillos news and recent openings. May try to talk more about specific stocks in 2024 and get back to how that was more my thing. So trying to launch some stock threads.



Company/employee culture

2nd version of their drive-thru/pickup-only design (all the rest include dine-in)

Las Vegas - coming soon

Atlanta, Denver, and Vegas - the expansion strategy details

Hook said that as Portillo’s opens new markets, it seeks get to scale as quickly as possible.

“We believe minimum scale in a market is at least six restaurants,” she said, noting that the company, after debuting in the Dallas market in early 2023, plans to open its fifth restaurant in the region, a unit in Mansfield, Texas, in the first quarter of 2024. “The goal is within 24 to 36 months of going into a market you get to scale,” she said.

Portillo’s has recently expanded beyond the Midwest to Arizona, Florida, and Texas, and the “vast majority” of its growth over the next couple of years will be in the Sun Belt, she said.

“We’re going to start scouting sites in Atlanta, Denver, and Vegas,” Hook added. “Those are the next three markets that we’ll look to enter.”

As an infill strategy, Portillo’s this past weekend opened its second drive-thru and pick-up only unit with no seating in Rosemont, Ill., after debuting the concept in 2022 in Joliet, Ill.

“We’ll use it today as just an infill strategy in that market, but, as we get scale in other markets, it’s definitely an opportunity that we’re going to continue to look at,” Hook said.

Portillo’s has also been working on reducing the size of the restaurants in other ways, Hook said.

“A traditional Portillo’s is probably anywhere from 10,000 to 11,000 square feet,” Hook explained. “If you go into the kitchen, you’ll see a production line that’s very linear, That’s about a 100 feet of production line.”

What the company has termed “Kitchen 23” is about 7,700 square feet, she said, with about 65 feet of production line. “Obviously, with that shrinkage on the line, you get less conveyance more adjacencies as you’re working,” Hook said, “and so we’ve seen the benefit of the labor efficiencies with this new kitchen as we move into what we’re calling the restaurant of the future. That prototype today is 5,500 to 6,000 square feet and the production line is about 47 feet. So we will start to build those late in ‘24 at the earliest.”

The company has also completed retrofits at 18 of its existing restaurants with the new, more efficient kitchen design, she said, and plans to do the remainder through 2025.

Restaurant Count and some Order statistics:
Portillo’s Inc. is adding 12 restaurants this year, bringing total to 84.

Portillo’s has seen its digital-order mix hold steady at about 22%. About 40% of its sales are through the drive-thru, about 40% is dine-in and 20% is through other channels, she said. About 13% to 14% of the other channels are delivery, which includes third-party platforms and its own delivery of orders $100 or more.

Dreamer <— Long PTLO

1 Like

There was a short investor conference PTLO was at on 1/9/24, and I took a listen.

Called out 9 new locations, mainly in sunbelt of AZ, TX, and FL, for 2024.
This is just over 10% unit growth over the current 84 restaurant locations they had at end of 2023.

Expect 2025 location growth to be 12% vs 10% in 2024. Then in years after they expect 12-15% location growth moving forward: so they see pace of expansion accelerating.

End of year Total Units could look like:
2023 - 84
2024 - 93
2025 - 104
2026 - 118
2027 - 134
2028 - 152
2029 - 172
2030 - 195
2031 - 221
2032 - 250

That aligns with my long-term investing horizon as well.

That translates to total revenues in range of $1.75b to
$2b conservatively, based on $7-8b AUV per restaurant.

At scale, conservatively 10% profit, or close to $200m in earnings/year.

PE multiple of 15-20 is $3-4b mkt cap, conservatively.

Calling current fully diluted class A plus class B today to be approx $1b mkt cap.
Current stock price is approx $15 (rounding up at moment).

That projected growth translates to a conservative CAGR of 11.6% annually over the next decade. This would be equivalent of $45 stock price.

I believe market indexes set to be choppy for rest of 2020’s given soft global macro projections thru 2030s, whereas I consider a sure thing in Portillos as a smart LTBH as I likely enter retirement within the next decade.

If the stock is awarded a 20 PE, using the above numbers, then the CAGR over next decade is closer to 14.8% per year. This would be equivalent of $60 stock price. Not bad.

Keeping in mind that stocks never go up in a perfectly linear fashion. It is quite possible (and I hope likely) that at some point PTLO location growth story catches eyes and ears of the market and the stock price gets loaded into a FOMO/MOMO trend during the next decade. Basically I am saying that if/when PTLO hits $45 or $60 within the next 10 years, I would likely sell some/all at $45 and remainder at $60, depending on how fast it hits those targets. If we see $45 in 2026, for example, that would make my largely 2023 investment in PTLO at about $14 translate into a 40-47% CAGR over those 3+ years. Hard for me not to take some gains there.

So that is the plan.
Hold for a decade, if needed.
Exit prices currently targeting are $45 and $60.

Will see.