As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the traditional fast food industry, including Dutch Bros (NYSE:BROS) and its peers.
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 14 traditional fast food stocks we track reported a mixed Q3. As a group, revenues were in line with analysts’ consensus estimates.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 5.7% since the latest earnings results.
Best Q3: 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 $338.2 million, up 27.9% year on year. This print exceeded analysts’ expectations by 4.1%. Overall, it was a stunning quarter for the company with an impressive beat of analysts’ EBITDA and same-store sales estimates.
Dutch Bros scored the biggest analyst estimates beat, fastest revenue growth, and highest full-year guidance raise of the whole group. Unsurprisingly, the stock is up 49.7% since reporting and currently trades at $52.27.
Is now the time to buy Dutch Bros? Find out by reading the original article on StockStory, it’s free.
Arcos Dorados (NYSE:ARCO)
Translating to “Golden Arches” in Spanish, Arcos Dorados (NYSE:ARCO) is the master franchisee of the McDonald's (NYSE:MCD) brand in Latin America and the Caribbean, responsible for its operations and growth in over 20 countries.Arcos Dorados reported revenues of $1.13 billion, flat year on year, outperforming analysts’ expectations by 0.5%. The business had a very strong quarter with an impressive beat of analysts’ same-store sales estimates and a solid beat of analysts’ EBITDA estimates.
Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 11.4% since reporting. It currently trades at $7.45.
Weakest Q3: Krispy Kreme (NASDAQ:DNUT)
Famous for its Original Glazed doughnuts and parent company of Insomnia Cookies, Krispy Kreme (NASDAQ:DNUT) is one of the most beloved and well-known fast-food chains in the world.Krispy Kreme reported revenues of $379.9 million, down 6.8% year on year, in line with analysts’ expectations. It was a disappointing quarter as it posted a significant miss of analysts’ EBITDA and EPS estimates.
Krispy Kreme delivered the slowest revenue growth and weakest full-year guidance update in the group. As expected, the stock is down 21.7% since the results and currently trades at $9.72.
Yum China (NYSE:YUMC)
One of China’s largest restaurant companies, Yum China (NYSE:YUMC) is an independent entity spun off from Yum! Brands (NYSE:YUM) in 2016.Yum China reported revenues of $3.07 billion, up 5.4% year on year. This result surpassed analysts’ expectations by 1.5%. Overall, it was a strong quarter as it also produced a solid beat of analysts’ EBITDA estimates and a decent beat of analysts’ EPS estimates.
The stock is up 7.6% since reporting and currently trades at $48.50.
El Pollo Loco (NASDAQ:LOCO)
With a name that translates into ‘The Crazy Chicken’, El Pollo Loco (NASDAQ:LOCO) is a fast food chain known for its citrus-marinated, fire-grilled chicken recipe that hails from the coastal town of Sinaloa, Mexico.El Pollo Loco reported revenues of $120.4 million, flat year on year. This print missed analysts’ expectations by 0.5%. Taking a step back, it was still a strong quarter as it put up a solid beat of analysts’ EBITDA and EPS estimates.
The stock is down 3.2% since reporting and currently trades at $11.80.
Want to invest in winners with rock-solid fundamentals? Check out our and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
This content was originally published on Stock Story
