Shorts Retreat as FRGI Extends Losses

FRGI is down 20% since the beginning of the year

Mar 21, 2022 at 12:33 PM
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Fiesta Restaurant Group, Inc. (NASDAQ:FRGI) is a Dallas, Texas-based restaurant chain. FRGI owns, operates, and franchises the Pollo Tropical restaurant brand, which specializes in the operation of fast casual and quick service restaurants. At last glance, FRGI is down 4.3% at $8.81.

Fiesta stock has decreased about 42% year-over-year but has shed 46% since peaking at a 52-week high of $16.40 last March. Additionally, shares of FRGI have already dropped 20% year-to-date and Fiesta stock is currently up just 3.4% from a 52-week low of $8.51 reached on Monday, March 14.

From a fundamental point of view, the restaurant chain has very little to offer other then its outlook for next year. In addition, the restaurant company holds a weak balance sheet with $36.8 million in cash and $174.15 million in total debt, which could pose serious problems for FRGI’s longevity. Overall, with a price-earnings ratio of 22.47 and a price-sales ratio of 0.64, Fiesta stock simply doesn’t offer a good valuation.

Lastly, short interest has been dropping, down 3% during the past two reporting periods. This accounts for 4% of the stock's available float, or more than two weeks' worth of pent-up buying power.

 

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