A focus on health and wellness is keeping some hungry customers away from fast-food restaurants. Others might be staying away because of… the election.
The Wendy’s Co. WEN, -2.75% said uncertainty surrounding the presidential election was one reason business stumbled during the second quarter, adding to the list of areas that claim the Clinton-Trump face-off has got people too nervous to spend.
“[W]hen a consumer is a little uncertain around their future and really trying to figure out what this election cycle really means to them, they’re not as zapped to spend as freely as they might have been a couple of quarters ago,” said Todd Penegor, chief executive officer at Wendy’s, during the Wednesday earnings call, according to a FactSet transcript.
Same-restaurant sales have been an issue across the fast-food industry. McDonald’s Corp. MCD, +0.41% reported U.S. same-store sales increased 1.8% in the second quarter, below the FactSet consensus. And Restaurant Brands International Inc. QSR, -0.59% Burger King’s parent company, reported 0.6% growth in same-restaurant sales, far below the 6.7% growth the company reported last year.
Analysts have been bearish on restaurant stocks recently, with Stifel Nicolaus analyst Paul Westra downgrading 11 restaurants, including Chipotle Mexican Grill Inc. CMG, -0.01% Darden Restaurants Inc. DRI, -1.24% and Panera Bread Co. PNRA, -0.09% on the belief that a decrease in restaurant sales “is a harbinger to a U.S. recession in 2017.”
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Analysts have said that civil unrest could have an impact on the restaurant business, with Papa John’s International Inc. PZZA, -1.17% upgraded on the belief that people will be so concerned that they’ll stay home and have dinner delivered.
http://www.marketwatch.com/story/we...erns-contributed-to-sales-slowdown-2016-08-10
GAF fast food industry analysis is probably world-class.