Brinker International's (EAT) turnaround is gaining momentum with current fiscal Q2 sales likely to be better, Morgan Stanley said Friday in a note.

"As sales data continues to move against our rating, even more so currently, we are stepping aside, acknowledging the impressive turnaround has legs," the firm said.

Morgan Stanley is looking at a fiscal Q2 same-store sales growth of 20% for the company's Chili's restaurants, "with upside possible depending on how [December] ends up." The firm sees Brinker's fiscal 2025 earnings per share at $6.74, about 25% above the guidance.

"It's clear to us that the upward estimate revision cycle for Brinker is not done yet," Morgan Stanley said. It upgraded the company's stock to equal-weight from underweight and raised the price target to $115 from $70.

Brinker shares were up nearly 3% in recent trading.

Price: 135.03, Change: +3.69, Percent Change: +2.81