Wingstop Stock Is Down 62% in 1 Year. Could the Sell-Off Be Nearing an End?

It has been a long year for chicken wing chain restaurant Wingstop (NASDAQ: WING). Its stock price is down 62% over the past year, and it is trading not just at a 52-week low but at a four-year low of around $122 per share.

But is the sell-off finally over? It may be, as Wingstopʻs stock price soared 8% on Aug. 14 -- one of its best days this year.

The catalyst? Aug. 14 was the date of record for its third-quarter dividend, payable on Sept. 5. That led to a surge of interest and may signal that Wingstop is starting to rebound.

Investors were buying in to qualify for the $ 0.33-per-share dividend payout, up from $0.30 last quarter. But beyond that, investors were looking to buy at a reduced valuation as Wingstop's P/E ratio is down to 27, from almost 43 in June.

Image source: Getty Images.

Why Wingstop stock crashed

Wingstop stock has been a solid performer over the years, with an average annualized return of about 16% over the past 10 years, beating the S&P 500.

However, the past few years have been difficult for Wingstop after a huge post-COVID-19 surge. The expansion that followed the surge was derailed by high inflation, higher costs, lower foot traffic, and massive debt for the fast food stock.

At the same time, Wingstop was way too expensive with a P/E ratio of over 100 in 2023 and 2024. Even as recently as June 2025, it was trading at 57 times earnings. It was all a recipe for a crash.

Wingstop is still seeing declining same-store sales. In Q2, they dropped 7.5%, after falling 8.7% in Q1. Wingstop has now had five straight quarters of same-store sales declines.

Is Wingstop a buy now?

But there are some bright spots. Revenue increased 5% due mostly to continued expansion, as Wingstop opened 102 new stores in the quarter. Since the company operates on a franchise model, it charges franchise fees on every store, so its aggressive plan to eventually open 10,000 stores globally continues. It currently has 3,255 stores.

But the company is being more strategic about it, looking to expand more internationally, with 2026 on pace to be a record year for international openings. The company now has 527 international stores, up 29% over the past year. There are 2,728 U.S. locations, up 13%.

Wingstop also saw net income increase 17% to $31.3 million, or $1.15 per share, in Q2. This is due to a decrease in the cost of sales as a percentage of sales to 73.3%, from 75.2% in Q2 of 2025. This was driven by a decrease in food, beverage, and packaging costs. Also, selling, general, and administrative expenses dropped to $30.2 million from $32.9 million a year ago.

So, can investors assume the worst is over? No. Wingstop has had false starts before, so a wait-and-see approach may be best.

But the business has had promising results with its Club Wingstop loyalty program and its quicker and more efficient smart kitchens. When you see same-store sales start to increase again and that valuation tick a bit lower, it will be time to buy Wingstop.

Dave Kovaleski has no position in any of the stocks mentioned. The Motley Fool recommends Wingstop. The Motley Fool has a disclosure policy.