Beef Prices Squeeze Texas Roadhouse, Analyst Downgrades Stock

On September 6th, 2025, Texas Roadhouse (NASDAQ: TXRH) experienced a more than 1% decline in its stock price, even as the broader S&P 500 index rose by 0.8%. This negative sentiment can be traced back to an analyst recommendation downgrade that occurred earlier that day.

Evercore ISI analyst David Palmer changed his view on Texas Roadhouse, downgrading the stock from "outperform" (buy) to "in-line" (hold). Palmer's current price target for the company's shares is $190, down from his previous target. In his analysis, the analyst expressed more concern about external factors, specifically the recent double-digit rise in beef prices, which he believes will persist into future quarters. As a result, Palmer lowered his annual earnings estimates for Texas Roadhouse in 2025 and 2026 to reflect the anticipated inflation.

However, the analyst was not entirely bearish on the company. He pointed out that Texas Roadhouse is effectively sustaining good same-restaurant sales and foot traffic growth, which are important metrics in the industry. This suggests that the company is navigating the challenging market conditions relatively well.

The Evercore ISI analyst's move came in contrast to a more bullish take by another analyst, Freedom Broker's Lynne Collier, who had initiated coverage of Texas Roadhouse with a "buy" recommendation and a price target of $211 per share just a day earlier.