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.

Show Full description

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	7.21
Change Percentage	1.69%
Open	7.08
Previous Close	7.09
Market Cap ( Millions)	26
Volume	591
Year High	17.76
Year Low	6.38
M A 50	7.14
M A 200	8.67

FCF Yield	-4.37%
Dividend Yield	0.00%
ROE	-34.10%
Debt / Equity	252.45%
Net Debt / EBIDTA	-3071.72%
Price To Book	0.75
Price Earnings Ratio	-1.86
Price To FCF	-22.89
Price To sales	0.15
EV / EBITDA	-39.84

2. A Mixed Bag for Ark Restaurants in Q3

Ark Restaurants Corp. reported a mixed bag of results for the third quarter ended June 28, 2025. The company's financial performance was marked by a beat on earnings per share (EPS), coming in at $0.83 relative to estimates of $0.67. However, revenue growth remains a concern, with analysts estimating zero growth for next year. The company's operating margin was also impacted by the impairment of $4.7 million on Sequoia's leasehold improvements and right-of-use assets.

Publication Date: Aug -18

                                    📋 Highlights
                                    Balance Sheet Strength:
                                                $12 million cash, $3.9 million debt, and $20 million credit facility capacity through June 2028.
Asset Impairment:
                                                $4.7 million recorded for Sequoia's leasehold and right-of-use assets.
High-Performing Restaurants:
                                                Robert (New York) and Rustic (Fort Lauderdale) exceeded expectations despite market slowdowns.
Struggling Locations:
                                                Sequoia (Washington, D.C.) and Bryant Park underperform due to reduced demand and event business.
Strategic Litigation & Expansion:
                                                Pursuing casino license for Meadowlands amid New York State's downstate license plans and ongoing Bryant Park litigation.

                                

Operational Performance: A Tale of Two Cities

According to Michael Weinstein, Chairman and CEO, individual restaurants are performing well, despite a slowdown in visitors to New York and Las Vegas. Robert in New York and Rustic in Fort Lauderdale are shining stars, performing above expectations. However, Sequoia in Washington, D.C., and Bryant Park are struggling due to a decline in demand and event business. This mixed performance highlights the challenges the company faces in its diverse portfolio of restaurants.

Balancing Act: Debt and Cash

Anthony Sirica, President and CFO, highlighted the company's balance sheet, noting $12 million in cash and $3.9 million in debt. The company has also secured a credit agreement extension through June 1, 2028, with $20 million of capacity. While the company's debt levels are manageable, the impairment charge and struggling restaurants will require careful management to maintain a healthy balance sheet.

Valuation: What's Priced In?

Ark Restaurants trades at a P/E Ratio of -1.84, reflecting the uncertainty surrounding the company's growth prospects. The P/S Ratio of 0.12 is also relatively low, suggesting that investors are cautious about the company's ability to drive revenue growth. Meanwhile, the ROIC of 16.13% and ROE of -43.22% highlight the company's mixed profitability. With a Dividend Yield of 0.0%, investors are not compensated for the risks associated with the company's uncertain growth trajectory.

3. NewsRoom

ARKR Stock Gains Following Q3 Earnings Amid Bryant Park Dispute

Aug -18

Source: zacks.com

Ark Restaurants Corp. (ARKR) Q3 2025 Earnings Call Transcript

Aug -12

Source: seekingalpha.com

Ark Restaurants Announces Financial Results for the Third Quarter of 2025

Aug -11

Source: businesswire.com

Ark Restaurants Announces Conference Call

Aug -06

Source: businesswire.com

ARKR Stock Up Despite Q2 Earnings Decline, Legal Costs Dampen Results

May -16

Source:

Ark Restaurants Corp. (ARKR) Q2 2025 Earnings Call Transcript

May -13

Source: seekingalpha.com

Ark Restaurants Announces Financial Results for the Second Quarter of 2025

May -12

Source: businesswire.com

ARKR Stock Gains Following Q1 Earnings Uptick, Revenues Decline

Feb -13

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: 5.3/10

Value: 8.1

Growth: 3.7

Quality: 5.1

Yield: 4.0

Momentum: 7.5

Volatility: 3.7

1-Year Total Return ->

Biglari

A-Score: 4.8/10

Value: 4.2

Growth: 2.3

Quality: 5.9

Yield: 0.0

Momentum: 10.0

Volatility: 6.3

1-Year Total Return ->

Cracker Barrel

A-Score: 4.6/10

Value: 6.3

Growth: 3.3

Quality: 2.8

Yield: 7.0

Momentum: 5.0

Volatility: 3.3

1-Year Total Return ->

Jack in the Box

A-Score: 4.0/10

Value: 7.7

Growth: 3.3

Quality: 3.5

Yield: 6.0

Momentum: 0.5

Volatility: 3.0

1-Year Total Return ->

Bloomin Brands

A-Score: 3.9/10

Value: 7.7

Growth: 2.0

Quality: 3.0

Yield: 8.0

Momentum: 0.5

Volatility: 2.3

1-Year Total Return ->

Ark Restaurants

A-Score: 3.1/10

Value: 9.6

Growth: 2.1

Quality: 2.4

Yield: 1.0

Momentum: 0.5

Volatility: 3.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

15.01%

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. A Mixed Bag for Ark Restaurants in Q3

Operational Performance: A Tale of Two Cities

Balancing Act: Debt and Cash

Valuation: What's Priced In?

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

7.21$

Current Price

7.21$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA