Fast Food Stocks to Consider for Second Half of 2019
While this past weekend’s G20 meeting held most analyst’s attention, certain fast food stocks have been quietly creeping up on all-time highs. Some fast food stocks have been on an absolute tear lately and show signs of prolonged success.
These fast food stocks are projected to grow substantially within the next few years and should be considered as strong additions to portfolios. Let’s take a further look into which stocks have been able to perform well in the first half of the year and have the potential to extend their growth into the second half of 2019.
The burger giant quietly climbed to a new all-time high Monday, trading as high as $209.43 per share. This new all-time high arrives as the 18th time this year that the company has set a new high. McDonald’s MCD is currently up over 17% on the year and is looking to carry this growth into the second half. McDonald’s is currently sitting at a Zacks Rank #3 (Hold) and has seen positive growth every month in 2019 thus far. Consensus Estimates are currently predicting earnings of $2.06 in fiscal 2019, which would be a 19.77% jump from the previously reported earnings of $1.72. Furthermore, Zacks Consensus Estimates are forecasting positive year over year earnings growth across the board through 2020.
Chipotle Mexican Grill
Chipotle CMG is currently listed as a Zacks Rank #1 (Strong Buy) and is a stock that might appeal to investors looking for growth potential and momentum. Chipotle has made a habit of surpassing our Consensus Estimates recently, with an average EPS surprise of 11.99% over the previous four quarters. Year over year estimates are calling for double-digit growth in both earnings and revenue all the way through the end of 2020. The company has been making remarkable earnings strides as it increased its earnings by 97.67% and hiked its sales 6.79% compared to the previous quarter (Q1 ’19vsQ4 ’18). The stock is up 66.7% year-to-date and has the potential to prolong this growth for substantial returns.
Shake Shack SHAK is another stock that has been tearing it up lately, up 51.8% YTD. Shake Shack is a Zacks Rank #3 (Hold) at the moment and has made moves in the right direction lately. The burger chain saw its earnings increase 116.67% to go along with a revenue jump of 6.71% Q4 2018 vs Q1 2019. Zacks Consensus Estimates are predicting earnings of $0.22 for the current quarter, which would result in a 69.23% increase from the $0.13 earnings Shake Shack reported last quarter. The company has been able to significantly surpass our Consensus Estimates three out of the past four quarters for an average EPS surprise of 45.53%. Shake Shack is another fast food stock that has seen recent success and can capitalize on new consumer preferences with its fresh, never-frozen burgers.
The Wendy’s Company
Like SHAK, Wendy’s WEN boasts that it sells fresh, never-frozen burgers and has been able to perform well so far this. The McDonald’s rival is up 23.7% on the year and estimates are looking solid at the moment. Wendy’s is currently a Zacks Rank #2 (Buy) with a solid earnings track record. The company was able to outperform our Consensus Earnings forecasts three times over the past four quarters, posting a 6.04% EPS surprise average. Year over year estimates anticipate 21.43% earnings jump on the back of a 7.29% revenue increase for the current quarter. In addition, Wendy’s has been able to improve its bottom line by 27.27%, as well as its top line by 7.36% in comparison to the previous year. And Wendy’s is set on returning its beloved spicy chicken nuggets to its menu in August, which could boost revenue and help carry on its first half momentum.
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