The ONE Group Hospitality, Inc. - Common Stock (STKS)

Shares of upscale restaurant company The One Group Hospitality (NASDAQ:STKS) fell 11.1% in the afternoon session after the company reported disappointing second-quarter 2025 financial results that missed analyst expectations on both revenue and earnings. The upscale restaurant operator posted earnings per share of $0.05, which fell significantly short of the $0.09 consensus forecast. While total revenue grew 20.2% year-over-year to $207.4 million, it still missed estimates. A key point of concern for investors was a 4.1% decline in same-store sales, a metric that tracks performance at existing locations. The company’s net loss also widened to $10.1 million from $7.3 million in the prior year, and it issued a weak revenue forecast for the next quarter, signaling potential challenges ahead.

Upscale restaurant company The One Group Hospitality (NASDAQ:STKS) missed Wall Street’s revenue expectations in Q2 CY2025, but sales rose 20.2% year on year to $207.4 million. Next quarter’s revenue guidance of $192.5 million underwhelmed, coming in 5.7% below analysts’ estimates. Its non-GAAP profit of $0.05 per share was significantly above analysts’ consensus estimates.

Many small-cap stocks have limited Wall Street coverage, giving savvy investors the chance to act before everyone else catches on. But the flip side is that these businesses have increased downside risk because they lack the scale and staying power of their larger competitors.

Shares of upscale restaurant company The One Group Hospitality (NASDAQ:STKS) fell 4.8% in the afternoon session on continued negative momentum after investment bank Piper Sandler initiated coverage on the stock with a "Neutral" rating. The initiation came with a price target of $6.00 per share. While this target suggested potential upside from recent trading levels, the lack of a strong bullish endorsement may have prompted a sell-off from investors who were hoping for a more positive catalyst. 

Shares of upscale restaurant company The One Group Hospitality (NASDAQ:STKS) fell 14.1% in the afternoon session after the investment bank Piper Sandler initiated coverage on the stock with a "Neutral" rating. While a "Neutral" rating indicates that the analyst expects the stock to perform in line with the broader market, it appears investors were anticipating a more optimistic "Buy" rating. The initiation came with a price target of $6.00 per share. Although this target suggests potential upside from recent trading levels, the lack of a strong bullish endorsement from a new analyst covering the company may have prompted a sell-off from investors who were hoping for a more positive catalyst. In the absence of other company-specific news, the market's reaction suggests disappointment with the lukewarm initiation.

Wall Street has issued downbeat forecasts for the stocks in this article. These predictions are rare - financial institutions typically hesitate to say bad things about a company because it can jeopardize their other revenue-generating business lines like M&A advisory.

Volatility cuts both ways - while it creates opportunities, it also increases risk, making sharp declines just as likely as big gains. This unpredictability can shake out even the most experienced investors.

A number of stocks jumped in the afternoon session after the major indices rebounded (Nasdaq +1.5%, S&P 500 +1.0%) as reports pointed to easing tensions between Israel and Iran. 

A number of stocks fell in the afternoon session after the major indices pulled back (Nasdaq -1.3%, S&P 500 -1.1%) as Israel carried out significant strikes on Iranian nuclear and military sites. This development has sent crude oil prices surging, as investors fear potential disruptions to global oil supply and a wider regional conflict. 

Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages. Just because a business is in the green today doesn’t mean it will thrive tomorrow.

While profitability is essential, it doesn’t guarantee long-term success. Some companies that rest on their margins will lose ground as competition intensifies - as Jeff Bezos said, "Your margin is my opportunity".

Upscale restaurant company The One Group Hospitality (NASDAQ:STKS) reported Q1 CY2025 results beating Wall Street’s revenue expectations, with sales up 148% year on year to $211.1 million. Revenue guidance for the full year exceeded analysts’ estimates, but next quarter’s guidance of $207.5 million was less impressive, coming in 2.3% below expectations. Its non-GAAP profit of $0.14 per share was significantly above analysts’ consensus estimates.

Investors can certainly boost their returns by concentrating on stocks trading between $1 and $10. However, a disciplined approach is necessary because many of these businesses are speculative and lack the underlying fundamentals to support their prices.

Investors looking for hidden gems should keep an eye on small-cap stocks because they’re frequently overlooked by Wall Street. Many opportunities exist in this part of the market, but it is also a high-risk, high-reward environment due to the lack of reliable analyst price targets.

Growth is oxygen. But when it evaporates, the consequences can be extreme - ask anyone who bought Cisco in the Dot-Com Bubble (Nvidia?) or newer investors who lived through the 2020 to 2022 COVID cycle.

Looking back on sit-down dining stocks’ Q1 earnings, we examine this quarter’s best and worst performers, including The ONE Group (NASDAQ:STKS) and its peers.

Upscale restaurant company The One Group Hospitality (NASDAQ:STKS) reported Q1 CY2025 results topping the market’s revenue expectations, with sales up 148% year on year to $211.1 million. Revenue guidance for the full year exceeded analysts’ estimates, but next quarter’s guidance of $207.5 million was less impressive, coming in 2.3% below expectations. Its non-GAAP profit of $0.14 per share was significantly above analysts’ consensus estimates.

Volatility cuts both ways - while it creates opportunities, it also increases risk, making sharp declines just as likely as big gains. This unpredictability can shake out even the most experienced investors.

The ONE Group has gotten torched over the last six months - since October 2024, its stock price has dropped 20.8% to $2.85 per share. This was partly due to its softer quarterly results and may have investors wondering how to approach the situation.