Wendy’s Q2 sales fall 3.6%, traffic down 12.5%, debt limits growth; stock rated sell

Wendy’s reported a 3.6% decline in same-restaurant sales in Q2 in the U.S., with customer traffic dropping 12.5%. Profit margins have worsened significantly amid intense competition. The company carries heavy debt of $2.76 billion, restricting its financial flexibility and forcing reliance on new store openings for modest revenue growth. Due to these challenges and the withdrawal of full-year guidance, Wendy’s stock is recommended as a sell in the current competitive market.