David Palmer's questions to Texas Roadhouse Inc (TXRH) leadership • Q3 2024
Question
David Palmer of Evercore ISI questioned the company's philosophy on pricing versus wages, noting that projected 2025 price increases in the 2% range would lag wage inflation of 4-5%. He asked if this was a conscious investment in labor or in consumer value.
Answer
Executive Michael Bailen confirmed it is an 'investment in the guest.' He clarified that pricing decisions are driven by a long-term commitment to the brand's value proposition, not as a direct reaction to short-term cost pressures. CEO Gerald Morgan reinforced this, stating they will always err on the side of 'screaming value' for the guest.