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Restaurant Brands' (QSR) Popeyes Unveils New Chicken Nuggets

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Restaurant Brands International Inc.’s (QSR - Free Report) Popeyes recently announced the addition of new Chicken Nuggets to its menu in Canada, the United States and Puerto Rico.

Based on the chicken sandwich recipe (launched in 2019), the preparation for the white meat chicken breast Nuggets involves beforehand marination, hand battered and breaded in buttermilk as well as a proprietary frying process. The option of pairing it with signature sauces like Bayou Buffalo, BoldBQ, Blackened Ranch, Buttermilk Ranch, Wild Honey Mustard, and Sweet Heat is available.

With respect to the launch, Sami Siddiqui, president, Popeyes Americas, stated, “Just like our game changing Chicken Sandwich, our new Chicken Nuggets are unlike anything you may have experienced before. We aim to show the world once again the magic of Popeyes chicken with our new Nuggets.”

The company will be offering the item ranging from four to 36 pieces, starting Jul 27. Moreover, the option of purchasing it through in-store and third party delivery services are also available.

Innovation to Drive the Top Line

Restaurant Brands believes that new product development is a key driver of long-term success of brands and it will continue to focus on the same. This is expected to drive traffic by expanding the customer base, spreading out into new dayparts as well as continuing to build brand leadership in food quality and taste.

During first-quarter 2021, the company made solid progress with regards to its core products with ingredients. This includes French toast sandwich, The Sourdough King and Cheesy Tots from Burger King and Cajun Flounder Sandwich from Popeyes. Also, the company initiated the roll out of hand-breaded chicken sandwich in half of its Burger King restaurants in the United States.

Price Performance

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Coming to price performance, shares of Restaurant Brands have gained 4.6% so far this year compared with the industry’s 12.6% growth. The dismal performance was mainly due to the coronavirus pandemic. Although the company reopened most of its restaurants, it is likely to witness dismal traffic due to social distancing protocols.

However, increased focus on various sales-building strategies and franchise business model are likely to help the company going forward. The company is confident about the Tim Hortons’s long-term growth prospects and is committed toward delivering on its international growth strategy of expanding the brand worldwide. This along with focus on off-premise capabilities through reimaging, drive-thru enhancements, loyalty program and applications are likely to drive growth in the upcoming periods.

Zacks Rank & Other Key Picks

Restaurant Brands currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some other top-ranked stocks in the same space include Ruth's Hospitality Group, Inc. (RUTH - Free Report) , Dine Brands Global, Inc. (DIN - Free Report) and The Cheesecake Factory Incorporated (CAKE - Free Report) , each sporting a Zacks Rank #1.

Ruth's Hospitality and Dine Brands 2021 earnings are expected to surge 381.6% and 269.3%, respectively.

Cheesecake Factory has a three-five year earnings per share growth rate of 8.5%.

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