TXRH Bets on Unit Growth: Will 35 New Stores in 2026 Move the Needle?

Texas Roadhouse, Inc. TXRH is leaning into unit expansion as a key growth lever, outlining plans to open roughly 35 company-owned restaurants in 2026. The slate includes about 20 Texas Roadhouse locations, 10 Bubba’s 33 units and up to five Jaggers restaurants, alongside additional franchise openings. The question for investors is whether this pace meaningfully accelerates earnings power or maintains momentum.

On paper, the math is supportive. Management expects 5-6% store-week growth in 2026, driven by new openings and the acquisition of remaining California franchise locations. With average weekly sales running strong across all three concepts, incremental units are expected to contribute reliable top-line growth. Texas Roadhouse’s disciplined site selection and operational playbook reduce execution risk, suggesting new stores are likely to ramp efficiently rather than dilute returns.

However, unit growth alone may not dramatically “move the needle” in the near term. The expansion comes against a backdrop of elevated beef inflation and margin pressure, which could temper the earnings contribution from new restaurants in their early months. Capital spending is also set to rise to about $400 million in 2026, underscoring that growth is capital-intensive.

Overall, the 35-store plan looks less like a bold acceleration and more like a steady compounding strategy. It reinforces Texas Roadhouse’s long-term growth engine, but the real upside will still hinge on traffic trends, cost moderation and how quickly new units mature into high-cash-flow restaurants.

How Competitors Stack Up on Unit Expansion

Two key competitors provide useful context for Texas Roadhouse as it targets 35 new company-owned stores in 2026.

LongHorn Steakhouse, owned by Darden Restaurants, Inc. DRI, follows a more conservative growth model. Darden typically delivers low-single-digit annual unit growth, prioritizing margin resilience and returns on invested capital. In an environment marked by beef inflation and labor pressure, LongHorn’s disciplined expansion highlights a strategy focused more on protecting profitability than accelerating footprint growth.

By contrast, Outback Steakhouse, part of Bloomin’ Brands, Inc. BLMN, has largely pulled back on aggressive U.S. unit expansion. Bloomin’ Brands is emphasizing operational improvements and selective international growth rather than meaningfully increasing its domestic store base.

Relative to DRI and BLMN, TXRH’s 2026 development plan stands out as one of the more assertive unit-growth strategies within the steakhouse category.

TXRH Stock’s Price Performance, Valuation & Estimates

Shares of Texas Roadhouse have surged 12.9% in the past month compared with the 2.6% growth of the industry.

TXRH’s Six-Month Price Performance

From a valuation standpoint, TXRH trades at a forward price-to-sales (P/S) multiple of 1.95, below the industry’s average of 3.63.

P/S (F12M)

The Zacks Consensus Estimate for TXRH’s 2026 earnings per share has increased to $6.62 in the past 60 days. The company is likely to report strong earnings, with projections indicating a 3.4% rise in 2026.

TXRH currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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