雅虎香港財經 11 Best Fast Food Stocks to Buy Now
In this article, we discuss 11 best fast food stocks to buy now. If you want to read about some more fast food stocks, go directly to 5 Best Fast Food Stocks to Buy Now.
The fast food industry has rapidly evolved in the past few years as trends like the proliferation of vegan-only options, tech-based delivery, and smart appliances accelerate growth. According to a report by digital agency Linchpin, artificial intelligence, expanded beverage options, and healthy sweeteners are some of the other disruptive forces in the space that investors should be closely monitoring. Linchpin estimates that there are 200,000 fast-food restaurants located across the United States at which 50 million customers eat fast food daily.
Some of the top stocks that benefit from this influx include Starbucks Corporation (NASDAQ:SBUX), McDonald’s Corporation (NYSE:MCD), and Yum! Brands, Inc. (NYSE:YUM), among others discussed in detail below. Digital orders at fast food restaurants are one of the most important market forces. Per data from Linchpin, these have registered an increase of 23% since first implemented. The digital agency expects this figure to triple in the coming months despite the easing of coronavirus restrictions worldwide.
Our Methodology
The companies that operate in the fast food sector were selected for the list. The analyst ratings of these firms and the latest updates related to them are also discussed to provide some additional context. Data from around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to identify the number of hedge funds that hold stakes in each firm.
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Best Fast Food Stocks to Buy Now
11. Good Times Restaurants Inc. (NASDAQ:GTIM)
Number of Hedge Fund Holders: 5
Good Times Restaurants Inc. (NASDAQ:GTIM) engages in the restaurant business in the United States. It is one of the best fast food stocks to invest in. On August 11, Good Times Restaurants posted earnings for the third quarter of 2022, reporting earnings per share of $0.04. The revenue over the period was $36.5 million, up 7.7% compared to the revenue over the same period last year.
At the end of the second quarter of 2022, 5 hedge funds in the database of Insider Monkey held stakes worth $2.7 million in Good Times Restaurants Inc. (NASDAQ:GTIM), compared to 5 in the preceding quarter worth $3.3 million.
Just like Starbucks Corporation (NASDAQ:SBUX), McDonald’s Corporation (NYSE:MCD), and Yum! Brands, Inc. (NYSE:YUM), Good Times Restaurants Inc. (NASDAQ:GTIM) is one of the best fast food stocks to buy now.
10. Jack in the Box Inc. (NASDAQ:JACK)
Number of Hedge Fund Holders: 15
Jack in the Box Inc. (NASDAQ:JACK) owns and runs quick service restaurants. It is one of the top fast food stocks to invest in. On August 10, Jack in the Box posted earnings for the third quarter of 2022, reporting losses per share of $1.38, beating market estimates by $0.04. The revenue over the period was $398.3 million, up 47.8% compared to the revenue over the same period last year and beating by market estimates by $0.93 million.
At the end of the second quarter of 2022, 15 hedge funds in the database of Insider Monkey held stakes worth $95 million in Jack in the Box Inc. (NASDAQ:JACK), compared to 22 in the preceding quarter worth $112 million.
9. Wingstop Inc. (NASDAQ:WING)
Number of Hedge Fund Holders: 20
Wingstop Inc. (NASDAQ:WING) franchises and operates restaurants under the Wingstop brand name. It is one of the premier fast food stocks to invest in. On October 17, Wingstop announced that it will give away free chicken sandwiches for a year in the form of a gift card to the first 50 fans at various locations in New York City. On October 12, Wingstop revealed the opening of its new restaurant in Emmaus. The restaurant will be owned and operated by Wingstop and Talon Restaurants.
On October 11, Deutsche Bank analyst Brian Mullan maintained a Hold rating on Wingstop Inc. (NASDAQ:WING) stock and raised the price target to $135 from $117, highlighting that investors expected the company’s Q3 domestic same-store-sales results to be below the current consensus estimates.
Among the hedge funds being tracked by Insider Monkey, London-based investment firm Fundsmith LLP is a leading shareholder in Wingstop Inc. (NASDAQ:WING), with 825,464 shares worth more than $61.7 million.
In its Q2 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Wingstop Inc. (NASDAQ:WING) was one of them. Here is what the fund said:
“Other new buys included Wingstop Inc. (NASDAQ:WING). Wingstop, meanwhile, in the consumer discretionary sector, is doing to chicken wings what Domino’s did to pizza. With a strong digital model, the franchise-based business has a long runway for growth with an existing base of 1,500 stores expanding to potentially 6,000 units and compelling franchisee economics.”
8. Papa John’s International, Inc. (NASDAQ:PZZA)
Number of Hedge Fund Holders: 20
Papa John’s International, Inc. (NASDAQ:PZZA) operates and franchises pizza delivery and carryout restaurants under the Papa John's trademark in the United States and internationally. It is one of the major fast food stocks to invest in. On October 19, Papa John's International launched its latest Halloween-themed international market campaign.
On October 7, BTIG analyst Peter Saleh maintained a Buy rating on Papa John's International, Inc. (NASDAQ:PZZA) stock and lowered price target to $115 from $130, highlighting that at some of the company's franchisees over the past week, sales trends slowed.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Starboard Value LP is a leading shareholder in Papa John’s International, Inc. (NASDAQ:PZZA), with 2.8 million shares worth more than $230.5 million.
In its Q3 2021 investor letter, Artisan Partners, an asset management firm, highlighted a few stocks and Papa John’s International, Inc. (NASDAQ:PZZA) was one of them. Here is what the fund said:
“Papa John’s International, Inc. (NASDAQ:PZZA) is a global operator and franchisor of pizza delivery and carryout restaurants. The company is tracking nicely against our turnaround thesis which hinges upon an improvement in store-level economics leading to accelerating growth in restaurant development activity. Improved store-level economics is being driven in part by market share gains resulting from menu innovation. New menu items—parmesan crusted Papadias, Epic Stuffed Crust, Shaq-a-roni— coupled with enhancements to the digital/loyalty platform and supportive advertising are attracting new customers to the brand, increasing frequency of its existing customers and driving higher unit volumes and returns. As a result, the company is experiencing incremental interest from new and existing franchisees to develop new restaurants. Papa John’s opened a record 123 units in the first half of 2021 and now expects to open 220-260 new stores this year (vs. 140-180 previously)—most of which are outside of the US. Combined with ample white space globally, we believe a higher unit growth trajectory will drive an attractive and sustainable profit cycle.”
7. Restaurant Brands International Inc. (NYSE:QSR)
Number of Hedge Fund Holders: 20
Restaurant Brands International Inc. (NYSE:QSR) operates as a quick service restaurant company. It is one of the elite fast food stocks to invest in. On September 9, Burger King, a chain of Restaurant Brands International, stated that it is planning for significant spending in the next two years towards reconstructing restaurants and marketing. $400 million will be allocated to increase advertisement firepower.
On October 12, investment advisory Deutsche Bank maintained a Buy rating on Restaurant Brands International Inc. (NYSE:QSR) stock and lowered the price target to $68 from $70. Analyst Brian Mullan issued the ratings update.
At the end of the second quarter of 2022, 20 hedge funds in the database of Insider Monkey held stakes worth $1.5 billion in Restaurant Brands International Inc. (NYSE:QSR), compared to 23 in the previous quarter worth $1.8 billion.
Here is what Pershing Square Holdings has to say about Restaurant Brands International Inc. (NYSE:QSR) in its Q2 2021 investor letter:
“QSR’s franchised business model is a high-quality, capital-light, growing annuity that generates high-margin brand royalty fees from three leading brands: Burger King, Tim Hortons and Popeyes. The company has nimbly navigated the COVID-19 pandemic and continues to make progress on returning its brands to sustainable long-term growth.
Since the onset of the COVID-19 pandemic, the company has bolstered its safety procedures and is accelerating its digital investments by expanding its delivery footprint, modernizing its drive-thru experience, increasing mobile ordering adoption, and improving its loyalty programs. As the global recovery continues to be uneven, these initiatives will allow the company and its franchisees to serve customers in a safe and reliable manner.
Each of the company’s brands are at various stages in recovery, with Burger King and Popeyes having returned to growth, while Tim Hortons is well on its way to recovering. On a two-year basis, same-store-sales grew 2.4% at Burger King and 24.4% at Popeyes during the last quarter. Meanwhile, Tim Hortons in Canada has improved to a mid-single digit decline in July, with each month during the second quarter showing sequential improvement. Tim Hortons’ slower recovery is largely driven by strict COVID-19 restrictions in Canada, which were only recently lifted in large provinces such as Ontario. In rural and suburban parts of Canada where restrictions were lifted earlier, Tim Hortons has already returned to growth. Given the habitual nature of Tim Hortons’ customer base, the recovery in sales will be tied to mobility and reopening.
The company expects to return to its historical mid-single-digit unit growth this year, and recently announced expansions for both Tim Hortons and Popeyes in large international markets. As underlying sales trends at each of its brands continue to improve, and as the impact from COVID-19 restrictions ease, we believe Restaurant Brands’ share price will more accurately reflect our view of its improving business fundamentals.”
6. The Wendy’s Company (NASDAQ:WEN)
Number of Hedge Fund Holders: 28
The Wendy’s Company (NASDAQ:WEN) operates as a quick-service restaurant company. It is one of the prominent fast food stocks to invest in. On September 26, Wendy’s stated that it is adding technology to its delivery process at thousands of its restaurants in the US and Canada by partnering with an order integrator, ItsACheckmate. 6,000 locations are selected all over Canada and the US for the purpose.
On September 22, Stephens analyst Joshua Long initiated coverage of The Wendy’s Company (NASDAQ:WEN) stock with an Overweight rating and a $25 price target, highlighting that ongoing menu and breakfast innovation would be an important driver of same-store sales and continued momentum in the growth of the firm.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Trian Partners is a leading shareholder in The Wendy’s Company (NASDAQ:WEN), with 25 million shares worth more than $478 million.
Alongside Starbucks Corporation (NASDAQ:SBUX), McDonald’s Corporation (NYSE:MCD), and Yum! Brands, Inc. (NYSE:YUM), The Wendy’s Company (NASDAQ:WEN) is one of the best fast food stocks to buy now according to elite investors.
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Disclosure. None. 11 Best Fast Food Stocks to Buy Now is originally published on Insider Monkey.
