Fast food chains and restaurants were influenced by the pandemic. Indeed, this fact surprised me given that fast food inventories were relatively buoyant in other crises.
That said, responding to the decline in stock prices of these companies is intriguing today for their recovery. surely, Restaurant Brands International (TSX: QSR)(NYSE: QSR) Is on Top of the list For many who expect stock prices to fall beyond the relatively narrow range that the company traded in later this year.
Here are some of the reasons I think this stock should definitely be on the investor’s watch list today.
Long-term growth outlook remains optimistic
Among the company’s main banners, Tim Hortons has been the banner that has provided the stock with a black mark for some time. Indeed, the decline in performance of the restaurant brand’s biggest revenue drivers has been noticeable in recent years.
That said, the pandemic has accelerated the decline in the performance of this banner. Pandemic-related restrictions have hit Tim Hortons more than their quick-service peers. No one goes to the office and grabs double-double, so it makes sense to understand why.
But this unfortunate reality can be seen positively as investors are bullish on a short-term economic resumption. If there is a stampede back to the office at some point later this year or early next year, the immediate outlook for Restaurant Brands looks much better. Needless to say, the company continues to develop long-term growth plans in major growth markets such as Asia.
In addition, I think it is important to repeat the optimism that industry experts describe today. The National Restaurant Association’s recent forecast for double-digit restaurant sales growth in North America in 2021 is certainly very bullish. Combining this report with the strong fundamentals of Restaurant Brands, the stock has become very attractive to growth-minded investors today.
Brand value remains an important moat for restaurant brands
It’s important to remember that Restaurant Brands is the conglomerate behind Tim Hortons, Burger King and Popeyes Louisiana Kitchen. These banners are world-renowned for their loyal global customer base. Indeed, these brands form the basis of a company’s lasting competitive advantage, or moat.
I think these banners are extremely important for the international growth of the restaurant brand that emerges from this pandemic. The company’s share price has reflected this sentiment so far this year. Indeed, QSR stocks have traded about 8% higher so far, and this momentum is expected to continue in the medium term as investors shift their portfolio allocation strategies to defensive resumption play.
Restaurant Brands management has recently done a good job of upgrading the products it offers and revitalizing its infrastructure. Combining these adjustments with a strong international growth strategy, I think the company is on track for long-term growth.
Of course, without the brand of the company that supports this treatise, the growth outlook wouldn’t look much rosy.
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This article represents the opinion of a writer who may disagree with the “official” recommendation position of the Motley Fool Premium Services or Advisors. We are Motley! Asking investment treatises, even our own, can help you think critically about your investment and make decisions to be smarter, happier, and richer. As a result, we may publish articles that may not match recommendations, rankings, or other content.
Stupid contributor Chris Macdonald There are no positions in any of the listed stocks. Motley Fool recommends RESTAURANT BRANDS INTERNATIONAL INC.
Best Stocks to Buy Today: Restaurant Brands
https://www.fool.ca/2021/04/05/the-best-stock-to-buy-today-restaurant-brands/ Best Stocks to Buy Today: Restaurant Brands