US restaurant chains fail to shake off consumer blues, margin pressures
31/12/2025 12:40
** S&P 500 Restaurants sub index .SPLRCREST down 1.3% YTD vs a 17.3% rise for the broader S&P 500 index .SPX ** Weak spending by younger customers and middle-income households hurt chains such as Chipotle Mexican Grill CMG.N and Mediterranean restaurant chain Cava Group CAVA.N, with shares falling ~40% and ~50% YTD, respectively ** Still demand for value meals helped McDonald's MCD.N revive sales this year, sending its shares up 6%, while Domino's Pizza DPZ.O shares rose marginally ** Value meals at Burger King and continued strength at Tim Hortons helped U.S.-listed shares of Restaurant Brands International QSR.N rise nearly 6% YTD ** Yum Brands shares YUM.N rose 13.5%, marking its third year of rise, as Taco Bell strength helps offset weakness in its KFC and Pizza Hut chains in the U.S. ** Yum also said it was mulling a sale of Pizza Hut ** It was also a turnaround year for Wendy's WEN.O, Jack in the Box JACK.O and Shake Shack SHAK.N as they contended with a highly competitive restaurant industry ** JACK and WEN on track to lose nearly half their value, while SHAK down nearly 37% ** A year into its turnaround under Brian Niccol, Starbucks' SBUX.O shares down ~6% this year, with high coffee prices hurting margins, even as sales improved ** SBUX and QSR both found local partners for their businesses in China this year to help revive sales in the market ** A bifurcated consumer spending environment, high costs of commodities such as beef, and high discounting, were some trends expected to continue in 2026, according to RBC Capital Markets analyst Logan Reich ** Investors are also closely watching the impact of weight loss drugs on consumer appetite for fast food and dining out
| Company | RIC | Shares as of last close, YTD | 2024 | 2023 |
| McDonald | MCD.N | 6.3% | -2.3% | 12.5% |
| Yum Brands | YUM.N | 13.4% | 2.7% | 2% |
| Restaurant Brands | QSR.N | 5.5% | -16.6% | 20.8% |
| Domino's Pizza | DPZ.O | 0.5% | 1.8% | 19% |
| Wendy | WEN.O | -49.2% | -16.3% | -13.9% |
| Chipotle Mexican Grill | CMG.N | -38.6% | 31.8% | 64.8% |
| Shake Shack | SHAK.N | -38.4% | 75.1% | 78.5% |
| Cava Group | CAVA.N | -54.5% | 162.5% | - |
| Starbucks | SBUX.O | -6.6% | -5% | -3.2% |
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