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El Pollo Loco Expands in California, Focuses on Vision Design


El Pollo Loco, Inc. LOCO has been constantly expanding its footprint and proliferating brand awareness among customers. To this end, the company recently launched a restaurant in Eastvale, CA.

The move underscores El Pollo Loco’s efforts to further foray into various markets. Giving expansion strategies an utmost priority, the company expects to open eight company-owned and nine to 10 franchised restaurants in the current year.

The restaurant in Eastvale will seat roughly 84 customersand feature the company’s ‘Vision Design’ initiative. A unique brand positioning and other sales-building strategies have led El Pollo Loco’s shares to gain 43.7% in the past year, outperforming the industry’s rally of 8.4%.

In order to drive revenue growth, El Pollo Loco focuses on expansion, and innovation across menu and ambiance. The company is opening all of its restaurants under the ‘Vision Design’ initiative. Restaurants under this program offer authentic atmosphere inspired by Mexico that includes El Pollo Loco’s menu and brand identity. Those restaurants also have an open-kitchen layout to display the preparation of the signature dish.

The company believes that its vision model is going to position it better in the quick-service restaurant space. According to El Polo Loco, it is witnessing encouraging results from the implementation of this model in various company-owned and franchised restaurants. It also aims to reduce costs and drive sales through this initiative.

Meanwhile, the distinguished menu that is served in the restaurant shows that the company is focusing on enriching guest experience to drive foot traffic and sales.

In fact, banking on these initiatives, El Pollo Loco witnessed year-over-year sales growth of 10.9% in the last reported quarter. Further, for the current year, the Zacks Consensus Estimate projects revenues to grow by 14.3% from the year-ago quarter.

Zacks Rank & Other Stocks to Consider

El Pollo Loco currently carries a Zacks Rank #2 (Buy). Some other top-ranked restaurant stocks are BJ’s Restaurants BJRI, Darden DRI and Dunkin’ Brands DNKN, each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Earnings for BJ’s Restaurants, Darden and Dunkin’ Brands for the current year are projected to increase by 66.7%, 16.8% and 16.9%, respectively.

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