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A Look Back at Traditional Fast Food Stocks' Q3 Earnings: Yum! Brands (NYSE:YUM) Vs The Rest Of The Pack

StockStory - Thu Jan 11, 3:08AM CST

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The end of an earnings season can be a great time to assess how companies are handling the current business environment and discover new stocks. Let’s take a look at how Yum! Brands (NYSE:YUM) and the rest of the traditional fast food stocks fared in Q3.

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% Investors abandoned cash-burning companies to buy stocks with higher margins of safety, 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.

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.

Yum! Brands Total Revenue

The stock is up 8.7% since the results and currently trades at $131.25.

Is now the time to buy Yum! Brands? 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 estimates.

Arcos Dorados Total Revenue

Arcos Dorados achieved the biggest analyst estimates beat among its peers. The stock is up 14.5% since the results and currently trades at $12.07.

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 6.6% since the results and currently trades at $14.33.

Read our full analysis of Krispy Kreme's results here.

Wendy's (NASDAQ:WEN)

Founded by Dave Thomas in 1969, Wendy’s (NASDAQ:WEN) is a renowned fast-food chain known for its fresh, never-frozen beef burgers, flavorful menu options, and commitment to quality.

Wendy's reported revenues of $550.6 million, up 3.4% year on year, falling short of analyst expectations by 0.8%. It was an ok quarter for the company, with a narrow beat of analysts' earnings estimates. For next quarter, the company guided same store sales and cash from operations above Wall Street Consensus (revenue and EPS profit wasn't explicitly given).

The stock is up 3.2% since the results and currently trades at $19.6.

Read our full, actionable report on Wendy's here, it's free.

Papa John's (NASDAQ:PZZA)

Founded by the eclectic John “Papa John” Schnatter, Papa John’s (NASDAQ:PZZA) is a globally recognized pizza delivery and carryout chain known for “better ingredients” and “better pizza”.

Papa John's reported revenues of $522.8 million, up 2.4% year on year, falling short of analyst expectations by 1.4%. It was a decent quarter for the company, with an impressive beat of analysts' gross margin estimates but a miss of analysts' revenue estimates.

The stock is up 10% since the results and currently trades at $71.76.

Read our full, actionable report on Papa John's here, it's free.

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The author has no position in any of the stocks mentioned

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