The Zacks Analyst Blog Highlights Dutch Bros, Brinker International, Texas Roadhouse and The ONE Group

Zacks Equity Research
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For Immediate Release

Chicago, IL – October 25, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Dutch Bros Inc. BROS, Brinker International, Inc. EAT, Texas Roadhouse, Inc. TXRH and The ONE Group Hospitality, Inc. STKS.

Here are highlights from Thursday’s Analyst Blog:

4 Restaurant Stocks with Growth Potential as Sales Soar

The U.S. restaurant industry grew at a solid pace over the past two years despite major challenges from higher borrowing and raw material costs. Higher personal income has been one of the key reasons Americans have been spending lavishly on eating out.

The Commerce Department reported earlier this month that restaurant sales showed impressive growth in September, boosting overall retail sales.

Given the bright outlook, investing in restaurant stocks, such as Dutch Bros Inc., Brinker International, Inc.,Texas Roadhouse, Inc. and The ONE Group Hospitality, Inc., which have seen positive earnings estimate revisions along with a favorable Zacks Rank, will be a prudent choice.

Restaurant Sales Soar in September

The Commerce Department reported last week that sales at U.S. bars and restaurants totaled $93.7 billion in September, increased a solid 5% from year-ago levels of $92.97 billion. For the nine months through September, restaurant sales totaled $855.4 billion.

Higher prices have been posing a challenge for restaurant owners as budget-conscious consumers look for value for money. Quick-service restaurants (QSRs), particularly those emphasizing value, have thus shown resilience in this challenging environment.

With budget-conscious consumers looking for affordable dining choices, the value-focused segments have become increasingly competitive. Brands are intensifying their promotional efforts and offering cost-saving deals to attract and keep customers.

Industry players are thus gaining from robust demand for value-oriented products and competitive pricing strategies. Several restaurants have been focusing on promotional campaigns, strategic alliances, and introducing new products to keep their customers engaged.

Fed Rate Cuts to Help Restaurant Stocks

The Federal Reserve cut interest rates by 50 basis points last month after inflation showed a substantial decline for months. The Fed’s first interest rate cut since March 2020 comes after it hiked interest rates by 525 basis points to take it to a 23-year high in its bid to combat inflation.

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