The restaurant industry ranges from local family restaurants to national and international chains. The industry is notoriously difficult for business owners, with around 60% of new restaurants going bankrupt in their first year. One of the reasons for this is that restaurant spending tends to be highly discretionary, fluctuating widely with the economy in general. Restaurant failure rate could accelerate due to the COVID-19 pandemic. The Delta variant has prompted many restaurants to close dining rooms again after opening them to customers earlier in the year. Some of the most well-known publicly traded restaurants include McDonald’s Corp. (MCD) and Chipotle Mexican Grill Inc. (CMG).
The restaurant industry, represented by the Dow Jones US Restaurants & Bars Index, has underperformed the overall market with a total return of 27.6% over the past 12 months, as of September 10, 2021. In By comparison, the total return of the Russell 1000 over the same period is 37.1%. All statistics in the tables below are as of September 10, 2021.
Here are the top 3 restaurant stocks with the best value, fastest growing, and most dynamic.
These are the stocks of restaurants with the lowest 12-month price / earnings (P / E) ratio. Since profits can flow back to shareholders in the form of dividends and buybacks, a low P / E ratio shows that you are paying less for every dollar of profit generated.
|Restaurant actions at the best value for money|
|Price ($)||Market capitalization ($ billion)||12-month PER ratio|
|Cracker Barrel Old Country Store Inc. (CBRL)||135.75||3.2||13.3|
|Jack In The Box Inc. (JACK)||100.56||2.2||13.9|
|Restaurants Del Taco Inc. (TACO)||8.50||0.3||14.7|
- Cracker Barrel Old Country Store Inc .: Cracker Barrel Old Country Store operates a chain of more than 660 restaurants in 45 US states. Its atmosphere and food have a southern theme.
- Jack in the Box Inc .: Jack in the Box operates and franchises restaurants of the same name. The chain serves burgers, sandwiches, salads, Mexican food and related items, and operates in the United States and Canada. For the third quarter of fiscal 2021, ended July 4, 2021, Jack in the Box reported a 23.0% year-over-year increase in net income on 11.2% year-on-year revenue growth. The company also saw growth in same store sales.
- Les Restaurants Del Taco Inc .: Del Taco Restaurants operates and franchises restaurants selling classic American and Mexican-inspired dishes. The company offers, among other things, tacos, burritos, cheeseburgers, fries and milkshakes.
These are the top restaurant stocks ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly year-over-year percentage revenue growth and their most recent quarterly earnings growth. per share (EPS) year-on-year. Sales and profits are critical factors in the success of a business. Therefore, ranking companies by a single growth indicator makes a ranking sensitive to accounting anomalies in this quarter (such as changes in tax laws or restructuring costs) that may render either figure unresponsive. representative of the company in general. Companies with quarterly EPS or revenue growth of over 2,500% were excluded as outliers.
|Fastest Growing Restaurant Inventories|
|Price ($)||Market capitalization ($ billion)||EPS growth (%)||Increase in income (%)|
|Chipotle Mexican Grill Inc. (CMG)||1901.03||53.4||2 180||38.7|
|Dave & Buster’s Entertainment Inc. (PLAY)||35.85||1.7||N / A (see company description)||642.9|
|Café Luckin Inc. (LKNCY)||16.10||4.1||N / A (see company description)||521.0|
- Chipotle Mexican Grill Inc .: Chipotle Mexican Grill operates a chain of quick and casual Mexican restaurants. The company serves items such as burritos, burrito bowls, tacos and salads, made with fresh ingredients. In the second quarter of 2021, net income increased nearly 23-fold thanks to strong revenue growth, comparable restaurant sales and digital sales.
- Dave & Buster’s Entertainment Inc .: Dave & Buster’s Entertainment owns and operates establishments across North America that combine food and entertainment for adults and children, including games and arcades. The company has released second quarter fiscal 2021 results for the quarter ended August 1 on September 9, 2021. Dave & Buster reported net income of $ 52.8 million for the quarter compared to net loss in the second quarter of fiscal 2020, as well as record revenue of $ 377.6 million. . The company cited its new menu, marketing and technology investments as the main drivers of the strong performance. Dave & Buster’s is not listed under EPS Growth in the table above as its EPS went from negative to positive during the period.
- Café Luckin Inc .: Luckin Coffee is a China-based coffeehouse chain with thousands of locations across China. Luckin had negative EPS for the most recent quarter, making it impossible to calculate EPS growth.
Restaurant stocks had the highest total returns over the past 12 months.
|Restaurant stocks with the most momentum|
|Price ($)||Market capitalization ($ billion)||12-month total return (%)|
|Café Luckin Inc. (LKNCY)||16.10||4.1||603.1|
|The One Group Hospitality Inc. (STKS)||10.16||0.3||426.4|
|Dave & Buster’s Entertainment Inc. (PLAY)||35.85||1.7||99.0|
|Russel 1000||N / A||N / A||37.1|
|Dow Jones Restaurants and Bars Index in the United States||N / A||N / A||27.6|
- Café Luckin Inc .: See company description above.
- The One Group Hospitality Inc .: The ONE Group Hospitality operates high-end restaurants and lounges in the United States and Europe. The company also provides hotel management services to hotels and casinos. ONE Group reported second quarter 2021 net income attributable to the company of $ 13.8 million, compared to a net loss for the previous year quarter, as well as record quarterly revenue of 70 , $ 8 million.
- Dave & Buster’s Entertainment Inc .: See company description above.
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