3 Gaining Restaurant Stocks to Buy January 2024

The restaurant industry is benefitting from easing inflation and the rise in consumer spending. It is poised for further expansion due to heightened consumer enthusiasm for dining experiences, evolving consumer preferences, and innovative dining concepts.

Considering these factors, it could be wise to buy fundamentally strong restaurant stocks Carrols Restaurant Group, Inc. (TAST – Get Rating), Domino’s Pizza Group plc (DPUKY – Get Rating), and Luckin Coffee Inc. ADR (LKNCY – Get Rating).

Before diving deeper into their fundamentals, let’s discuss what’s shaping the restaurant industry’s prospects.

In November, the restaurant industry achieved its strongest same-store traffic performance in nearly two years, showing a year-to-year growth acceleration of 0.7 percentage points. Same-store sales growth was 1.9% in November, a 0.5 percentage-point sequential improvement. Moreover, consumer spending increased by $46.7 billion (0.2%) in November.

According to the NRA, restaurant sales have been steadily rising, reaching $94.7 billion in November, marking the ninth consecutive month of growth. Over the last nine months, eating and drinking place sales increased by 8.5%, outpacing the 1.7% gain in non-restaurant retail sectors during the same period, highlighting consumers’ sustained prioritization of dining out and spending on experiences.

The restaurant industry is expected to see robust growth in the near term due to the rising popularity of dining out, takeout, and delivery. The surge in demand for online food delivery services since the pandemic underscores the importance of adapting to evolving consumer preferences for sustained success.

The global quick-service restaurant market is projected to reach $1.78 trillion by 2030, growing at a CAGR of 11.2%. The global food service market is expected to grow at a CAGR of 10.8% and reach $5.42 trillion by 2030.

Considering these conducive trends, let’s analyze the fundamental aspects of the three Restaurants picks, beginning with…

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