U.S. restaurants are expected to report softer third-quarter sales, with analysts flagging weaker same-store sales in September that could weigh on results across much of the sector.
Checks by Jefferies show about most companies may come in at or below Wall Street estimates, as industry data pointed to choppy demand late in the quarter.
“We are more conservative re: near-term SSS and see moderate downside risk in 3Q,” analysts at Jefferies said.
Fast casual chains underperformed while promotional activity boosted quick-service and casual dining operators.
Jefferies analysts downgraded Portillo’s to Hold from Buy given uncertainty around sales recovery and margins, while upgrading Shake Shack to Hold from Underperform after a recent stock pullback reset expectations.
Buy ratings were reiterated on McDonald’s, Dutch Bros, Cava, Wingstop and First Watch, with analysts calling investor skepticism “overly reflected” in share moves.
Risks remain around beef costs, with Texas Roadhouse and Shake Shack flagged as most exposed to rising prices.
Source :
https://www.investing.com/news/stock-market-news/us-restaurants-face-softer-q3-as-september-sales-weaken-says-jefferies-4284515
