12:52 PM EST, 11/10/2025 (MT Newswires) -- Wendy's (WEN) is projected to close about 300 underperforming US locations in 2026 amid ongoing same-store sales challenges, particularly at franchisee sites, RBC Capital Markets said Monday.

Last week, the fast food chain logged better-than-expected fiscal third-quarter financial results. However, same-restaurant sales in the US fell 4.7% versus a 0.2% gain in the prior-year quarter. Company-owned stores in the US outperformed franchisees by 400 basis points, representing an early sign that its operational improvements are translating to top-line growth, RBC analyst Logan Reich said in a Monday note to clients.

However, interim Chief Executive Ken Cook flagged during an earnings call on Friday that the company estimates to close "around a mid-single-digit percentage" of underperforming US restaurants, according to a FactSet transcript. "Sales remain under pressure and we are acting with urgency to return US (comparable) sales to growth," Cook said.

RBC estimates these closures to be about 300 locations.

"We have some restaurants that do not elevate the brand and are a drag from a franchisee financial performance perspective," Cook told analysts last week. "We ultimately will close that restaurant, which will put money back in franchisee's pockets and enable them to reinvest both capital and resources in their remaining restaurants."

RBC lowered its price target on the Wendy's stock to $9 from $10, with a sector perform rating.

The company's shares were down 4.4% in Monday afternoon trade. The stock has lost 47% in value so far in 2025.

Ongoing same-store sales challenges, especially at franchisee locations, are forcing Wendy's to shift focus on driving same-store sales growth and away from unit growth, according to RBC. The brokerage projects advertising funding to decline by 9.7% in fiscal 2026 versus fiscal 2024, due to the store closures, potentially weighing on same-store sales growth.

Wendy's maintained its fiscal 2025 outlook for adjusted earnings of $0.82 to $0.89 per share and global system-wide sales to be down 3% to 5%. The move implies that the company's system sales and EPS will be down 3.8% and 28%, respectively, to consensus in the fourth quarter, RBC said.

Wendy's new "Tendies" menu item could generate further upside to revenue in the fourth quarter, after seeing higher-than-expected demand for the chicken tenders last month, as the company begins to advertise it next week, according to the brokerage.

Price: 8.60, Change: -0.37, Percent Change: -4.12