Restaurant Brands International Inc. ( QSR Quick Quote QSR - Free Report) is likely to benefit from expansion efforts, menu innovation and the loyalty program. Also, focus on re-imaging initiatives bodes well. However, pandemic-induced soft traffic is a concern. Let us discuss the factors highlighting why investors should retain the stock for the time being. Factors Driving Growth
Restaurant Brands believes that there is a huge opportunity to grow all its brands around the world by expanding its presence in existing markets as well as entering new markets. To this end, the company continues to evaluate opportunities to ramp up international development of all the three brands by establishing master franchisees with exclusive development rights as well as joint ventures with new and existing franchisees. During second-quarter 2021, the company opened the 400th Burger King store in France in association with its master franchisee, Groupe Bertrand.
Shares of Restaurant Brands have moved up 1.9% so far this year compared with the
industry’s 10.9% growth. The dismal performance was primarily caused by the coronavirus pandemic. During second-quarter 2021, sales in Ontario were negatively impacted by strict lockdowns. Although a majority of dining services are open, traffic is still low compared with pre-pandemic levels. We believe that the Delta variant of coronavirus might hurt traffic and sales in the upcoming periods. Zacks Rank & Key Picks
Restaurant Brands currently carries a Zacks Rank #3 (Hold). You can see
the complete list of today’s Zacks #1Rank (Strong Buy) stocks here. Some better-ranked stocks in the same space include The Cheesecake Factory Incorporated ( CAKE Quick Quote CAKE - Free Report) , Chipotle Mexican Grill, Inc. ( CMG Quick Quote CMG - Free Report) and Domino's Pizza, Inc. ( DPZ Quick Quote DPZ - Free Report) . Cheesecake Factory sports a Zacks Rank #1, while Chipotle and Domino's carry a Zacks Rank #2 (Buy). Cheesecake Factory’s 2021 earnings are expected to surge 268.5%. Chipotle has a trailing four-quarter earnings surprise of 6.9%, on average. Domino's has a three-five year earnings per share growth rate of 12%.