Texas Roadhouse Surpasses Olive Garden To Become No. 1 Casual Dining Chain in America: Can It Keep Up the Pace?

Texas Roadhouse has accomplished quite the feat in dethroning Olive Garden as the No. 1 casual dining chain in America, according to Restaurant Business.

The news comes after the steakhouse chain posted impressive Q4 2024 earnings outlining a comparable sales increase of 7.7% at company restaurants and 6.3% at domestic franchise restaurants. Average weekly sales at company restaurants increased from $141,653 (of which $17,793 were to-go orders) the year prior to an average of $153,867 (of which $20,067 were to-go orders).

Citing Technomic data crowning Texas Roadhouse the U.S. champion of casual dining, Restaurant Business also indicated that the steakhouse had pushed systemwide sales upward by 14.7% last year and had opened 26 new locations (an improvement of 4.1%).

By contrast, Olive Garden reported a 2024 sales improvement of just 0.8%, representing a trend for most of the top 10 restaurants profiled by Technomics. Applebee's (-5.8%), Outback Steakhouse (-3.9%), Red Lobster (-22.7%), and Red Robin (-4.2%) all saw a downward trend in yearly sales figures, and the overall average — even including big winners such as Texas Roadhouse, Chili's (+15%), and LongHorn Steakhouse (+7.2%) — was just 0.6% in the positive direction.

Despite the apparent headwinds facing the U.S. casual dining market as a whole, it appears that Texas Roadhouse has managed to carve out a path to success — at least for now.

CNBC's Jim Cramer Is Bullish on Texas Roadhouse's Future Fortunes

Controversial stock analyst and TV personality Jim Cramer appears to be bullish regarding the prospect of Texas Roadhouse's immediate future, as Insider Monkey reported.

“Texas Roadhouse (TXRH) stock I like so much we decided to buy some for the charitable trust two weeks ago. These guys reported what I thought was a darn good quarter, with better-than-expected same-store sales up 7.7% alongside a healthy earnings beat. Sure, not as crazy as the results from Brinker, absolutely, but Texas Roadhouse is a much more mature company. It just happens to be a real steady operator with a lot of room to grow," Cramer began.

"Also, unlike Brinker, Texas Roadhouse has held up surprisingly well, with the stock down only a few from early February, even as it had a tough week and a tough day. At one point, it was down 6.5 bucks today. That said, I like this one for the same reason I like Brinker. Texas Roadhouse offers what I call relative value. It may be a steakhouse, but it’s a bargain versus the competition. Where else can you get an 8-ounce steak with two sides for $9.99 on the Wild West?” he added.

Cramer isn't exactly alone in his rosy outlook concerning the steakhouse's prospects in the U.S. market. A TipRanks breakdown of the stock's current value versus expectations affords TXRH a "moderate buy" call, with 18 experts rating it a buy, 17 rating it a hold, and none rating it a sell.