Quarterly earnings results are a good time to check in on a company’s progress, especially compared to other peers in the same sector. Today we are looking at Carrols (NASDAQ:TAST), and the best and worst performers in the traditional fast food group.
Traditional fast-food restaurants are renowned for their speed and convenience, boasting menus filled with familiar and budget-friendly items. Their reputations for on-the-go consumption make them favored destinations for individuals and families needing a quick meal. This class of restaurants, however, is fighting the perception that their meals are unhealthy and made with inferior ingredients, a battle that's especially relevant today given the consumers increasing focus on health and wellness.
The 15 traditional fast food stocks we track reported a decent Q3; on average, revenues missed analyst consensus estimates by 0.6% Stocks have faced challenges as investors prioritize near-term cash flows, but traditional fast food stocks held their ground better than others, with the share prices up 8.3% on average since the previous earnings results.
With a reputation for reviving underperforming locations, Carrols Restaurant Group (NASDAQ:TAST) is the largest franchisee of Burger King restaurants and also a major Popeyes franchisee.
Carrols reported revenues of $475.8 million, up 7.2% year on year, topping analyst expectations by 1.5%. It was a stunning quarter for the company, with an impressive beat of analysts' earnings estimates.
Deborah Derby, President and Chief Executive Officer of Carrols, commented, “We are pleased to report yet another quarter of exceptional performance for Carrols, demonstrated by strong comparable sales growth at our Burger King and Popeyes restaurants, along with a 74% increase in our restaurant-level profitability. We were thrilled to achieve positive traffic growth at our Burger King restaurants earlier than anticipated, with great traction on recent product launches, such as the BK Royal Crispy Wraps, which significantly outperformed expectations in the third quarter. Equally important, we delivered continued improvement in our speed of service and guest satisfaction scores, as our team members worked hard to provide our guests with an excellent experience in our restaurants.”
The stock is up 50.9% since the results and currently trades at $9.38.
Is now the time to buy Carrols? Access our full analysis of the earnings results here, it's free.
Best Q3: Arcos Dorados (NYSE:ARCO)
Translating to “Golden Arches” in Spanish, Arcos Dorados (NYSE:ARCO) is the master franchisee of the McDonald's brand in Latin America and the Caribbean, responsible for its operations and growth in over 20 countries.
Arcos Dorados reported revenues of $1.13 billion, up 22.1% year on year, outperforming analyst expectations by 3.4%. It was a stunning quarter for the company, with an impressive beat of analysts' revenue and earnings estimates.
Arcos Dorados achieved the biggest analyst estimates beat among its peers. The stock is up 20.5% since the results and currently trades at $12.7.
Is now the time to buy Arcos Dorados? Access our full analysis of the earnings results here, it's free.
Weakest Q3: Krispy Kreme (NASDAQ:DNUT)
Famous for its Original Glazed doughnuts and parent company of Insomnia Cookies, Krispy Kreme (NASDAQ:DNUT) is one of the most beloved and well-known fast-food chains in the world.
Krispy Kreme reported revenues of $407.4 million, up 7.9% year on year, falling short of analyst expectations by 1.6%. It was a weak quarter for the company, with a miss of analysts' earnings estimates.
Krispy Kreme had the weakest full-year guidance update in the group. The stock is up 0.5% since the results and currently trades at $13.51.
Begun as a Chicago hot dog stand in 1963, Portillo’s (NASDAQ:PTLO) is a casual restaurant chain that serves Chicago-style hot dogs and beef sandwiches as well as fries and shakes.
Portillo's reported revenues of $166.8 million, up 10.4% year on year, falling short of analyst expectations by 2.3%. It was a mixed quarter for the company, with an impressive beat of analysts' gross margin estimates but a miss of analysts' revenue estimates.
The stock is down 13.6% since the results and currently trades at $13.01.
Yum! Brands (NYSE:YUM)
Spun off as an independent company from PepsiCo, Yum! Brands (NYSE:YUM) is a multinational corporation that owns KFC, Pizza Hut, Taco Bell, and The Habit Burger Grill.
Yum! Brands reported revenues of $1.71 billion, up 4.1% year on year, falling short of analyst expectations by 3.6%. It was a mixed quarter for the company, with an impressive beat of analysts' gross margin estimates but a miss of analysts' revenue estimates.
The stock is up 7.2% since the results and currently trades at $129.44.
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The author has no position in any of the stocks mentioned