El Pollo Loco: 3 Key Takeaways for Long-Term Investors
On its third-quarter 2026 earnings call , held on Nov. 5, 2026, El Pollo Loco(NASDAQ:LOCO) announced that systemwide same-store sales -- sales at restaurants open at least a year -- grew 5% year over year. The restaurant operator is expanding its digital loyalty network while securing multi-unit development deals outside its core West Coast footprint. Three things management said stand out.
1. Geographic Expansion Targets New State Markets
El Pollo Loco is accelerating restaurant openings, using experienced franchise operators to establish footholds in markets such as New York. Management expects second-generation site conversions--rebuilding existing restaurant properties--to reduce construction costs as national expansion gains speed.
In September, we announced our planned entry into New York, a big step in becoming a national brand.
-- Elizabeth Williams, Chief Executive Officer
2. Digital Loyalty Drives Repeat Customer Traffic
Digital orders reached 31% of total sales during the quarter. The company relies on its Loco Rewards loyalty program to increase order frequency and lock in repeat customer visits during tight spending cycles.
Our Loco Rewards members continue to be our most engaged guests visiting twice as often as nonmembers each year.
-- Elizabeth Williams, Chief Executive Officer
3. Operational Discipline Holds Restaurant Margins Steady
Restaurant contribution margin -- the percentage of restaurant sales remaining after direct store operating costs -- landed inside target ranges. Management balances targeted promotional deals against wage costs to protect store-level profitability.
Restaurant level margin was 18.4% this quarter, within our long-term target range of 18% to 20%.
-- Elizabeth Williams, Chief Executive Officer
Looking Ahead
Franchise demand is expanding beyond the West Coast, and management shows clear confidence in regional growth. The company relies on lower-cost site conversions and digital order growth while management monitors pricing discipline.
With New York on the map and more partners lining up, we're taking the brand into new parts of the country with confidence.
-- Elizabeth Williams, Chief Executive Officer
Operational execution will stay essential for driving recurring customer visits.
Our delicious food brings guests into our restaurants, but accuracy, speed and value are the basics that bring guests back and consistent execution in the restaurant turns a first visit into a recurring one.
-- Elizabeth Williams, Chief Executive Officer
Should you buy stock in El Pollo Loco right now?
Before you buy stock in El Pollo Loco, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and El Pollo Loco wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflixmade this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $358,037!* Or when Nvidiamade this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,229,708!*
Now, it's worth noting Stock Advisor's total average return is 897% — a market-crushing outperformance compared to 211% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor , and join an investing community built by individual investors for individual investors.
*Stock Advisor returns as of November 6, 2026.
The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .
El Pollo Loco: 3 Key Takeaways for Long-Term Investors was originally published by The Motley Fool
