Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at Restaurant Brands (NYSE: QSR) and the best and worst performers in the traditional fast food industry.
Traditional fast-food restaurants are renowned for their speed and convenience, boasting menus filled with familiar and budget-friendly items. Their reputations for on-the-go consumption make them favored destinations for individuals and families needing a quick meal. This class of restaurants, however, is fighting the perception that their meals are unhealthy and made with inferior ingredients, a battle that's especially relevant today given the consumers increasing focus on health and wellness.
The 13 traditional fast food stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 0.8%.
While some traditional fast food stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.8% since the latest earnings results.
Restaurant Brands (NYSE: QSR)
Formed through a strategic merger, Restaurant Brands International (NYSE: QSR) is a multinational corporation that owns three iconic fast-food chains: Burger King, Tim Hortons, and Popeyes.
Restaurant Brands reported revenues of $2.41 billion, up 15.9% year on year. This print exceeded analysts’ expectations by 2.9%. Overall, it was a strong quarter for the company with same-store sales in line with analysts’ estimates.
Unsurprisingly, the stock is down 5.9% since reporting and currently trades at $64.56.
Is now the time to buy Restaurant Brands? Access our full analysis of the earnings results here, it’s free.
Best Q2: Dutch Bros (NYSE: BROS)
Started in 1992 by two brothers as a single pushcart, Dutch Bros (NYSE: BROS) is a dynamic coffee chain that’s captured the hearts of coffee enthusiasts across the United States.
Dutch Bros reported revenues of $415.8 million, up 28% year on year, outperforming analysts’ expectations by 3.1%. The business had a stunning quarter with a solid beat of analysts’ EBITDA and same-store sales estimates.
Dutch Bros pulled off the biggest analyst estimates beat and fastest revenue growth among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 7.6% since reporting. It currently trades at $53.42.
Is now the time to buy Dutch Bros? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Jack in the Box (NASDAQ: JACK)
Delighting customers since its inception in 1951, Jack in the Box (NASDAQ: JACK) is a distinctive fast-food chain known for its bold flavors, innovative menu items, and quirky marketing.
Jack in the Box reported revenues of $333 million, down 9.8% year on year, falling short of analysts’ expectations by 2.1%. It was a softer quarter as it posted a miss of analysts’ EBITDA and same-store sales estimates.
Jack in the Box delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 1.4% since the results and currently trades at $19.20.
Read our full analysis of Jack in the Box’s results here.
Arcos Dorados (NYSE: ARCO)
Translating to “Golden Arches” in Spanish, Arcos Dorados (NYSE: ARCO) is the master franchisee of the McDonald's brand in Latin America and the Caribbean, responsible for its operations and growth in over 20 countries.
Arcos Dorados reported revenues of $1.14 billion, up 2.8% year on year. This number lagged analysts' expectations by 1.8%. Taking a step back, it was a mixed quarter as it also logged a beat of analysts’ EPS estimates but a significant miss of analysts’ same-store sales estimates.
The stock is flat since reporting and currently trades at $6.97.
Read our full, actionable report on Arcos Dorados here, it’s free.
Wendy's (NASDAQ: WEN)
Founded by Dave Thomas in 1969, Wendy’s (NASDAQ: WEN) is a renowned fast-food chain known for its fresh, never-frozen beef burgers, flavorful menu options, and commitment to quality.
Wendy's reported revenues of $560.9 million, down 1.7% year on year. This print surpassed analysts’ expectations by 0.6%. Zooming out, it was a mixed quarter as it also recorded an impressive beat of analysts’ EBITDA estimates but full-year EBITDA guidance missing analysts’ expectations.
The stock is down 8.2% since reporting and currently trades at $9.15.
Read our full, actionable report on Wendy's here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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