Last summer, Red Lobster made $20 endless shrimp a permanent menu item.
Dining out may have gained popularity during the post-lockdown recovery, but based on recent data, the American public may be losing some of its appetite for fast food, fast casual, and other dining establishments. This leaves restaurant stocks at risk of declining in price. Stocks in this sector have already been squeezed by factors like high inflation. During 2022 and 2023, the popularity of dining out stayed strong despite higher prices and smaller portions, but with U.S. economic growth slow
The restaurant industry is difficult. Competition is fierce. Consumers are picky. Workers are transitory. And profit margins can be razor thin. The National Restaurant Association estimates that only 20% of restaurants are successful. About 60% of all restaurants fail in their first year of operation, and 80% fail within five years of opening. Those are some depressing statistics and they help to explain why many restaurant stocks chronically underperform the broader market. Currently, there’s q