面条公司（NDLS）：在预期出色的同店销售额年份中客流量好转；一些成本是暂时的

USA | RestaurantsNoodles & Company Traffic Turning in What Should be a StandoutSSS Year; Some Costs Transitory 1Q SSS 4.4% beat 3.8% Cons, driven by a positive inflection in traffic with sales~inline while lower RLM drove EBITDA miss. The latter reflecting investmentsin food quality/new menu, labor, & marketing ramp, all of which is supportingSSS momentum (Apr an accel to +MSD%) that could accelerate through '25. FYSSS guide for MSD% was reiterated, and looks increasingly attainable despitethe current backdrop as tangible drivers materialize. Reit Buy, PT to $2.50. Encouraging traffic momentum beginning to build.1Q system SSS 4.4% beat Cons 3.8% withCo SSS 4.7% comprised of 1.9% traffic and 2.8% check (incl 1.3% price). Trends acceleratedexiting Feb (recall SSS >3% through first 8 weeks) and even more so following the March rolloutof the new menu (5 new dishes, with ~2/3rds of the menu now new or improved), which drovefurther acceleration through Apr where SSS is trending ~MSD% (since mid-Mar launch) andreflecting positive traffic. Innovation is resonating well and driving frequency in existing/lapsedusers, augmented by effective marketing/media (incl behind brand campaign) that should continueto ramp, and loyalty (seeing DD% traffic growth in those occasions). Given strength to-date andtraction behind tangible comp drivers that are beginning to materialize, we raise our '25 systemSSS to 4.9% from 3.6%, incl 5.3% in 2Q. Making necessary investments in quality & experience to deliver on top-line, which could flowthrough more meaningfully as the year progresses.RLM of 10.3% missed Cons 12.7% primarilydriven by higher-than-expected COGS and other OpEx, the former driven by incremental qualityinvestments and some impact from obsolescent menu items, and the latter reflecting elevatedmarketing & 3PD fees. Some 1x training costs related to the new menu rollout were also reflected inhigher labor YoY, which normalizes through the remainder of '25. RLM guide was slightly narrowedat the lower-end to 12% to 14% (from 12.5% to 14% prev), primarily driven by the incorporation ofpotential commodity risk re: tariff impact from produce sourced in South America & shrimp fromAsia. We lower our '25 RLM est to 12.5% from 12.9%, but see opptys for leverage particularly in the2H where potential flow-through could contribute to more meaningful upside to our/Street ests. Reiterate Buy.We remain encouraged by recent SSS momentum where incremental traffic driversare materializing quicker than anticipated, relative to our initial expectations. We see add'l roomfor upside as '25 progresses where Co may emerge as a relative outperformer despite a morechallenging backdrop, in still early innings of execution against a turnaround/reacceleration, a viewthat appears underappreciated in depressed valuations. PT to $2.50 (from $2.75), reflecting ~10x'26E EBITDA. Andy Barish * | Equity Analyst(415) 229-1524 | abarish@jefferies.com Alexander Slagle, CFA * | Equity Analyst(415) 229-1508 | aslagle@jefferies.com Marshall Pittman * | Equity Associate+1 (415) 229-1467 | mpittman@jefferies.com Ivan Yu * | Equity Associate+1 (415) 229-1441 | iyu@jefferies.com The Long View: Noodles & Company Investment Thesis / Where We Differ •We see potential for improving SSS & traffic trends in 2025+, and animproved system/portfolio of units where strategic initiatives could provemore meaningful in driving topline.•We believe valuation overly discounts the longer-term opportunity andrecovery at NDLS. Downside Scenario,$0.50, -50% Upside Scenario,$4.00, +296% Base Case,$2.50, +148% ‘25/26E system-wide SSS: 6.0%/3.0%‘25/26E EBITDA: $23m/$26mPT: $4, or ~11x ’26E EBITDA ‘25/26E system-wide SSS: 4.9%/2.0%‘25/26E EBITDA: $20m/$22mPT: $2.50, or ~10x ’26E EBITDA ‘25/26E system-wide SSS: 4.0%/1.0%‘25/26E EBITDA: $17m/$18mPT: $0.50 or ~7x ’26E EBITDA Sustainability Matters Catalysts Top Material Issue(s): 1)Labor Practiceshave a direct impact on an operator’s ability to attract & retaintalent at both the hourly & manager level, which affect service levels and the customer experience, andthus translate to revenues and the pipeline of talent to support future store growth.2) Supply ChainManagement,both as a function of responsible sourcing (animal welfare, carbon footprint throughoutthe supply chain) and innovation (sustainable & ethical alternatives), plays a vital role in an organization’sfuture success and can materially affect food availability/input cost pressures over time. •SSS drivers to continue via ops improvements,menuinnovation,off-premise,andRewardsprogram/marketing•Operational changes to restaurant profitability Company Target(s): 1)Continue to increase recycling, reduce waste, and improve water/energyefficiency2)Promote DE&I Qs to Mgmt: 1)How do turnover & retention vary at different levels of the organization, and how does thiscompare across the franchise system?2)What key initiatives are in place to increase recycling, reducewaste, and