We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The restaurant industry is likely to have benefited from gradual improvement in demand, robust off-premise sales, sales building efforts and digital initiatives. However, dismal dine-in visitations and increase in the cost of employee wages, benefits and insurance, and other operating costs such as rent continue to hurt the company. Although traffic has been increasing, it is still below the pre-pandemic level.
Restaurant operators’ focus on digital innovation, sales building initiatives and cost savings efforts has been acting as a catalyst. With the growing influence of the Internet, digital innovation has become the need of the hour. Restaurant operators are constantly partnering with delivery channels and digital platforms to drive incremental sales. Partnerships with delivery channels like DoorDash, Grubhub, Postmates and Uber Eats, and rollout of self-service kiosks and loyalty programs continue to drive growth.
The industry has been gaining from increase in off-premise sales, which primarily includes delivery, takeout, drive-thru, catering, meal kits, and off-site options such as kiosks and food trucks due to the coronavirus pandemic.
However, the restaurant industry has been facing declining traffic for quite some time now. The pandemic has aggravated the scenario. Rapid increase in menu price and the coronavirus pandemic are the primary reasons behind traffic erosion. The restaurant operators are grappling with high cost of operations.
Sneak Peek into Upcoming Earnings Releases
Let’s focus on a few restaurant companies that are scheduled to release fourth-quarter 2021 earnings on Feb 8.
According to the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Chipotle Mexican Grill, Inc. (CMG - Free Report) is scheduled to report results after the closing bell.
The multi-pronged growth strategy, robust digitization, comps growth, the opening of Chipotlane and other sales-building efforts are likely to have favored Chipotle's fourth-quarter performance.
Digital sales — accounting for 42.8% of total sales — have been aiding the company buoyed by its simplified online ordering site, the “Smarter Pickup Times” technology rollout, the rewards program, advertising and collaboration with all the major third-party delivery aggregators.
In order to boost convenience in the digital ordering platform, the company has been initiating features such as unlimited customization, contactless delivery and group ordering. The idea of using robotics-based autonomous vehicles for delivery purposes is likely to get reflected in the to-be-reported quarter's results. (Read more: Chipotle to Report Q4 Earnings: What to Expect)
The company has a Zacks Rank #3 and an Earnings ESP of +0.49%.
Chipotle Mexican Grill, Inc. Price and EPS Surprise
YUM! Brands, Inc. (YUM - Free Report) is scheduled to report results before the opening bell. In the last reported quarter, the company’s bottom line beat the Zacks Consensus Estimate by 15.1%.
Yum! Brands’ fourth-quarter performance is likely to have benefited from a focus on off-premise channels, menu innovations and strategic investments in digital technology. The company's partnership with online food delivery platform Grubhub continues to enhance online sales and delivery from its restaurants. At the end of the third quarter of 2021, it had more than 41,000 restaurants offering delivery globally.
Despite the pandemic-induced challenging environment, the company impressed investors with robust same-store sales growth in third-quarter 2021 and the trend is likely to have continued in the fourth quarter. The company might have gained from robust sales momentum in North America, the U.K., and Australia, along with improved performance in Europe. (Read more: Factors Setting the Tone For YUM! Brands (YUM - Free Report) Q4 Earnings)
Yum China Holdings, Inc. (YUMC - Free Report) is slated to report results after the closing bell. In the last reported quarter, the company’s bottom line missed the Zacks Consensus Estimate by 15.4%.
Yum China results in fourth-quarter 2021 is likely to have benefited from relentless unit growth, average check growth and menu innovations. KFC continues to grow at a faster pace, while Pizza Hut’s robust performance bodes well. However, dismal traffic might have weighed on the to-be-reported quarter's performance.
The company has a Zacks Rank #4 (Sell) and an Earnings ESP of -3.03%.
Image: Bigstock
Restaurant Stocks' Feb 8 Q4 Earnings Roster: CMG, YUM & YUMC
The restaurant industry is likely to have benefited from gradual improvement in demand, robust off-premise sales, sales building efforts and digital initiatives. However, dismal dine-in visitations and increase in the cost of employee wages, benefits and insurance, and other operating costs such as rent continue to hurt the company. Although traffic has been increasing, it is still below the pre-pandemic level.
Restaurant operators’ focus on digital innovation, sales building initiatives and cost savings efforts has been acting as a catalyst. With the growing influence of the Internet, digital innovation has become the need of the hour. Restaurant operators are constantly partnering with delivery channels and digital platforms to drive incremental sales. Partnerships with delivery channels like DoorDash, Grubhub, Postmates and Uber Eats, and rollout of self-service kiosks and loyalty programs continue to drive growth.
The industry has been gaining from increase in off-premise sales, which primarily includes delivery, takeout, drive-thru, catering, meal kits, and off-site options such as kiosks and food trucks due to the coronavirus pandemic.
However, the restaurant industry has been facing declining traffic for quite some time now. The pandemic has aggravated the scenario. Rapid increase in menu price and the coronavirus pandemic are the primary reasons behind traffic erosion. The restaurant operators are grappling with high cost of operations.
Sneak Peek into Upcoming Earnings Releases
Let’s focus on a few restaurant companies that are scheduled to release fourth-quarter 2021 earnings on Feb 8.
According to the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Chipotle Mexican Grill, Inc. (CMG - Free Report) is scheduled to report results after the closing bell.
The multi-pronged growth strategy, robust digitization, comps growth, the opening of Chipotlane and other sales-building efforts are likely to have favored Chipotle's fourth-quarter performance.
Digital sales — accounting for 42.8% of total sales — have been aiding the company buoyed by its simplified online ordering site, the “Smarter Pickup Times” technology rollout, the rewards program, advertising and collaboration with all the major third-party delivery aggregators.
In order to boost convenience in the digital ordering platform, the company has been initiating features such as unlimited customization, contactless delivery and group ordering. The idea of using robotics-based autonomous vehicles for delivery purposes is likely to get reflected in the to-be-reported quarter's results. (Read more: Chipotle to Report Q4 Earnings: What to Expect)
The company has a Zacks Rank #3 and an Earnings ESP of +0.49%.
Chipotle Mexican Grill, Inc. Price and EPS Surprise
Chipotle Mexican Grill, Inc. price-eps-surprise | Chipotle Mexican Grill, Inc. Quote
YUM! Brands, Inc. (YUM - Free Report) is scheduled to report results before the opening bell. In the last reported quarter, the company’s bottom line beat the Zacks Consensus Estimate by 15.1%.
Yum! Brands’ fourth-quarter performance is likely to have benefited from a focus on off-premise channels, menu innovations and strategic investments in digital technology. The company's partnership with online food delivery platform Grubhub continues to enhance online sales and delivery from its restaurants. At the end of the third quarter of 2021, it had more than 41,000 restaurants offering delivery globally.
Despite the pandemic-induced challenging environment, the company impressed investors with robust same-store sales growth in third-quarter 2021 and the trend is likely to have continued in the fourth quarter. The company might have gained from robust sales momentum in North America, the U.K., and Australia, along with improved performance in Europe. (Read more: Factors Setting the Tone For YUM! Brands (YUM - Free Report) Q4 Earnings)
The company has a Zacks Rank #3 and an Earnings ESP of +0.62%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Yum Brands, Inc. Price and EPS Surprise
Yum Brands, Inc. price-eps-surprise | Yum Brands, Inc. Quote
Yum China Holdings, Inc. (YUMC - Free Report) is slated to report results after the closing bell. In the last reported quarter, the company’s bottom line missed the Zacks Consensus Estimate by 15.4%.
Yum China results in fourth-quarter 2021 is likely to have benefited from relentless unit growth, average check growth and menu innovations. KFC continues to grow at a faster pace, while Pizza Hut’s robust performance bodes well. However, dismal traffic might have weighed on the to-be-reported quarter's performance.
The company has a Zacks Rank #4 (Sell) and an Earnings ESP of -3.03%.
Yum China Price and EPS Surprise
Yum China price-eps-surprise | Yum China Quote
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.