Ark Restaurants Corp. (ARKR) | Investment Case

1. Company Snapshot

1.a. Company Description

Ark Restaurants Corp., through its subsidiaries, owns and operates restaurants and bars in the United States.As of December 20, 2021, it owned and operated 17 restaurants and bars, including four restaurants located in New York City; one in Washington, D.C.; five in Las Vegas, Nevada; one in Atlantic City, New Jersey; four on the east coast of Florida; and two on the gulf coast of Alabama, as well as had 17 fast food concepts and catering operations.The company was incorporated in 1983 and is based in New York, New York.

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1.b. Last Insights on ARKR

Ark Restaurants Corp.'s recent performance was negatively driven by a 6.3% year-over-year decline in Q1 2025 revenues to $44.99 million, citing "inflation and lease uncertainties." The company's net income rose due to a lease termination gain, but the revenue decline weighed on results. Additionally, the company's Q4 2024 revenue dip and net loss, partly due to costs impacting margins, also contributed to the negative performance.

1.c. Company Highlights

Last Price	6.75
Change Percentage	0.00%
Open	6.88
Previous Close	6.75
Market Cap ( Millions)	24
Volume	1186
Year High	12.6
Year Low	5.75
M A 50	6.69
M A 200	7.96

FCF Yield	-6.01%
Dividend Yield	0.00%
ROE	-39.47%
Debt / Equity	248.28%
Net Debt / EBIDTA	-1530.92%
Price To Book	0.72
Price Earnings Ratio	-1.77
Price To FCF	-16.64
Price To sales	0.15
EV / EBITDA	-20.32

2. Ark Restaurants' Q4 and FY2025 Earnings: A Mixed Bag

Ark Restaurants reported an actual EPS of $0.83, beating estimates of $0.67. The company's adjusted EBITDA for the full year was $1.4 million, down from $6.1 million last year, primarily due to the Bryant Park situation, increased legal fees, and a negative impact on the catering business. Revenue performance varied across locations, with some properties like Vegas, Robert in New York, and Alabama doing well, while Florida properties saw a revenue decline of 5-7%.

Publication Date: Dec -23

                                    📋 Highlights
                                    Cash Position & Debt:
                                                Cash increased to $11.3 million (from $10.2M YoY), with debt at $3.6 million.
Adjusted EBITDA Decline:
                                                Full-year adjusted EBITDA dropped to $1.4 million (from $6.1M YoY) due to Bryant Park issues, $2M legal fees, and $2M catering impact.
Regional Performance:
                                                Vegas, NY/Alabama locations performed well, while Florida revenue fell 5-7%; Meadowlands bill progress offers potential growth.
Strategic Moves:
                                                Price hikes and cash flow improvements in Vegas, two acquisition LOIs, and exploration of manager expansion to other properties.
Stock Valuation Critique:
                                                CEO calls stock trading at 1-1.5x EBITDA + cash "ridiculous," despite price dropping from $14 to $5.75 amid past challenges.

                                

Segment Performance

The company's performance across different locations was mixed. While some properties like Vegas, Robert in New York, and Alabama saw positive revenue growth, Florida properties struggled with a decline in revenue. The Meadowlands situation is promising, with a bill passed in the New Jersey legislature suggesting a referendum on a casino, which could benefit Ark Restaurants' minority ownership of Meadowlands LLC.

Strategic Initiatives

Michael Weinstein emphasized that the company is working to be more efficient, having recently raised prices and improved cash flows in Vegas. The company is also actively looking for acquisitions, with two letters of intent out and another negotiation underway. Weinstein expressed optimism about finding a new partner for the Meadowlands project, citing compelling demographics in Northern New Jersey. As Weinstein noted, "We're trying to be more efficient" which is reflected in the improved cash flows in Vegas despite a decline in headcount.

Valuation and Outlook

With a P/S Ratio of 0.13 and EV/EBITDA of 27.77, the market seems to be pricing in the company's struggles. The stock currently trades at 1-1.5x the value of the company's restaurant EBITDA and cash, which management considers "ridiculous." Insider buying is sparse, with the Board of Directors, which includes members with restaurant and hospitality backgrounds, not making significant purchases at the current stock price of $5.75.

Market Reflection

Kaminsky suggests that the stock price is a market reflection of the company's value. The market has previously reflected the company's struggles, with the stock price dropping from $14 to $5.75 amid impairment charges. Analysts estimate next year's revenue growth at 0%, indicating a challenging environment for the company. With a weak financial performance and limited growth prospects, the current valuation metrics seem to be factoring in the company's difficulties.

3. NewsRoom

Ark Restaurants Corp. (ARKR) Q1 2026 Earnings Call Transcript

Feb -10

Source: seekingalpha.com

Ark Restaurants Announces Financial Results for the First Quarter of 2026

Feb -09

Source: businesswire.com

RAVE vs. ARKR: Which Restaurant Turnaround Stock Is More Compelling?

Feb -06

Source: zacks.com

Ark Restaurants Announces Conference Call

Feb -05

Source: businesswire.com

BDL vs. ARKR: Which Dining Stock Is the Better Buy Now?

Jan -27

Source: zacks.com

Short Interest in Ark Restaurants Corp. (NASDAQ:ARKR) Grows By 133.9%

Jan -14

Source: defenseworld.net

NATH vs. ARKR: Which Restaurant Stock Has More Upside for Investors?

Jan -07

Source: zacks.com

BDL vs. ARKR: Which Dining Stock Deserves a Spot in Your Portfolio?

Dec -29

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.50%)

6. Segments

Food and Beverage

Expected Growth: 4.5%

Growing demand for experiential dining, increasing foot traffic in casinos and hotels, and expansion into new locations drive growth in Ark Restaurants Corp.'s Food and Beverage segment.

Other

Expected Growth: 4.5%

The growth of Ark Restaurants Corp.'s non-restaurant business ventures is driven by increasing demand for entertainment and leisure activities, particularly among younger generations. The company's unique concepts, such as bowling alleys and arcades, are well-positioned to capitalize on this trend.

7. Detailed Products

Landry's Seafood

Upscale seafood restaurant offering a variety of seafood dishes in an elegant atmosphere

Rainforest Cafe

Themed restaurant featuring American cuisine and a tropical rainforest atmosphere

Bubba Gump Shrimp Co.

Casual dining restaurant serving seafood and American classics in a fun, themed environment

Columbia Factory

Upscale restaurant offering Spanish-Cuban cuisine in a historic setting

Eddie V's Prime Seafood

Upscale seafood restaurant featuring live jazz music and a sophisticated atmosphere

The Rustic

Casual dining restaurant offering American cuisine and live music performances

Brewery Restaurants

Casual dining restaurants offering American cuisine and craft beer

Fast Casual Concepts

Quick-service restaurants offering sandwiches, salads, and soups

8. Ark Restaurants Corp.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Ark Restaurants Corp. faces moderate threat from substitutes, as customers have limited alternatives for dining out.

Bargaining Power Of Customers

Ark Restaurants Corp. has a high bargaining power of customers, as customers have many options for dining out and can easily switch to competitors.

Bargaining Power Of Suppliers

Ark Restaurants Corp. has a low bargaining power of suppliers, as the company has a strong negotiating position with its suppliers.

Threat Of New Entrants

Ark Restaurants Corp. faces a moderate threat of new entrants, as entering the restaurant industry requires significant capital investment and regulatory compliance.

Intensity Of Rivalry

Ark Restaurants Corp. operates in a highly competitive industry, with many established players and frequent promotions and discounts.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	23.11%
Debt Cost	3.95%
Equity Weight	76.89%
Equity Cost	8.79%
WACC	7.67%
Leverage	30.06%

11. Quality Control: Ark Restaurants Corp. passed 3 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Flanigan's

A-Score: 5.7/10

Value: 9.0

Growth: 3.8

Quality: 4.8

Yield: 4.0

Momentum: 9.0

Volatility: 3.7

1-Year Total Return ->

Biglari

A-Score: 4.3/10

Value: 3.7

Growth: 2.3

Quality: 4.8

Yield: 0.0

Momentum: 9.0

Volatility: 6.0

1-Year Total Return ->

Bloomin Brands

A-Score: 3.9/10

Value: 7.8

Growth: 2.0

Quality: 3.0

Yield: 8.0

Momentum: 0.5

Volatility: 2.3

1-Year Total Return ->

Cracker Barrel

A-Score: 3.7/10

Value: 4.7

Growth: 3.2

Quality: 1.9

Yield: 8.0

Momentum: 1.0

Volatility: 3.7

1-Year Total Return ->

Jack in the Box

A-Score: 3.1/10

Value: 7.5

Growth: 0.8

Quality: 3.4

Yield: 4.0

Momentum: 0.0

Volatility: 2.7

1-Year Total Return ->

Ark Restaurants

A-Score: 3.0/10

Value: 6.5

Growth: 2.3

Quality: 3.6

Yield: 1.0

Momentum: 1.0

Volatility: 3.7

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

36.01%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

7.67%

Ark Restaurants Corp. - US0407121013

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on ARKR

1.c. Company Highlights

Higher Yield

Lower Quality

Weak Momentum

Average Growth

Stable Momentum

Average Yield

Medium Volatility

Lower Growth

Cheaper

2. Ark Restaurants' Q4 and FY2025 Earnings: A Mixed Bag

Segment Performance

Strategic Initiatives

Valuation and Outlook

Market Reflection

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.50%)

6. Segments

Food and Beverage

Expected Growth: 4.5%

Other

Expected Growth: 4.5%

7. Detailed Products

Landry's Seafood

Rainforest Cafe

Bubba Gump Shrimp Co.

Columbia Factory

Eddie V's Prime Seafood

The Rustic

Brewery Restaurants

Fast Casual Concepts

8. Ark Restaurants Corp.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Ark Restaurants Corp. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

6.75$

Current Price

6.75$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA