Flanigan's Enterprises, Inc. (BDL Quick QuoteBDL - Free Report) investors have been experiencing some short-term gains from the stock lately, despite its bumpy ride over recent months. Shares of the owners and operators of the "Flanigan's Seafood Bar and Grill" restaurants and "Big Daddy's" retail liquor stores, which is based in Fort Lauderdale, FL, have gained 37.7% in the past six months against the industry’s 8.1% decline. In the same time frame, the stock also outperformed the sector and the S&P 500’s 10.3% and 17.7% gains, respectively.

A major development of BDL in recent months includes the announcement of its promising results for the 13 weeks ended June 28, 2025, in August. The company reported a robust improvement in the top and bottom lines during the period. It also recorded strength in its restaurant food and bar sales, package store sales and franchise-related revenues during the quarter. However, its rental income and other revenues were relatively flat.

Flanigan's management acknowledged that pricing actions taken over the past year helped offset higher food and liquor costs as well as rising labor expenses. The company expects food and bar sales to continue benefiting from these increases through the remainder of fiscal 2025. At the same time, executives cautioned that inflation remains a significant headwind, impacting utilities, insurance, cleaning and other restaurant-related expenses.

BDL’s Six Months Price Comparison

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Over the past six months, the stock’s performance has remained strong, outperforming its peers like Ark Restaurants Corp. (ARKR Quick QuoteARKR - Free Report) and Nathan's Famous, Inc. (NATH Quick QuoteNATH - Free Report) . Ark Restaurants’ and Nathan's Famous’ shares have lost 25% and gained 13%, respectively, in the same time frame.

Despite several challenges within the restaurant industry, including rising food and labor costs, the favorable share price movement indicates that the company might be able to maintain the positive market momentum at present.

Flanigan's operates a network of 32 establishments comprising restaurants, package liquor stores, combination restaurant/package liquor stores and a sports bar. Additionally, it franchises five units, including two restaurants and three combination restaurant/package liquor stores, all located in South Florida. These multiple store footprints reflect robust growth potential.

Flanigan's Strong Fundamentals Weigh In

BDL operates both restaurants under the Flanigan’s Seafood Bar & Grill brand and package liquor stores under Big Daddy’s Liquors. This dual format provides steady, recurring liquor store sales, while leveraging brand recognition and customer traffic at restaurants. The company’s liquor stores focus on high-volume sales of brand-name and private-label products at competitive prices, which supports resilience even during economic downturns. This diversification strengthens Flanigan’s revenue base beyond the restaurant cycle.

Flanigan’s has a long operating history in South Florida, with deeply rooted community ties and brand recognition. The company pursues a gradual expansion strategy through limited partnerships and selective openings, allowing it to maintain operational control while reducing capital risk. Strong consumer affinity for its casual dining concept and “value-for-money” positioning helps the brand sustain customer loyalty in a competitive market. This local dominance forms a competitive moat that supports long-term growth.

Flanigan’s locks in key food supply agreements to mitigate cost volatility — for example, fixed-cost contracts for baby back ribs. This forward-looking approach to procurement provides stability in margins despite inflationary pressures in commodities and labor. Such structural cost discipline, rather than just short-term earnings improvements, positions BDL to deliver consistent profitability over time.

Challenges Ahead for BDL

Flanigan’s faces rising labor costs and staffing shortages in a competitive hospitality market, which could pressure margins if not offset by productivity gains. In addition, intense competition from both national restaurant chains and discount liquor superstores threatens its ability to sustain market share and pricing power. Together, these challenges highlight structural pressures that could constrain long-term growth if not carefully managed.

Flanigan's Stock Valuation

Flanigan’s trailing 12-month EV/Sales of 0.29X is lower than the industry’s average of 4.45X but higher than its five-year median of 0.25X.

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Ark Restaurants and Nathan’s Famous’ trailing 12-month EV/Sales currently stand at 0.09X and 3.02X, respectively, in the same time frame.

Our Final Take on BDL

There is no denying that Flanigan’s sits favorably in terms of core business strength, earnings prowess, robust financial footing and opportunities. The stock’s strong core growth prospects present a good reason for existing investors to retain shares for potential future gains. New investors are also likely to be motivated to add the stock following the current uptrend in share prices.

For those exploring to make new additions to their portfolios, the valuation indicates superior performance expectations compared with its industry peers. It is still valued lower than the industry, which suggests potential room for growth if it can align more closely with overall market performance. However, if investors are already holding the stock, it would be prudent to hold on to it at present.