February restaurant survey shows settling of new year strength
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Weekly restaurant for Feb. 5 week ending shows slight uptick vs. two-weeks back. The average for the last three weeks has settled from the early January strength and continues to translate slower one-year comps performance.
Private chains with annualized $14B or above sales show a 9% surge in the current week vs. +8% in January, and +5% in Q4 22 overall. Bifurcating: fast-casual up 14% in most recent week, casual dining up 4%, and quick service up 4%.
Three-year comparision shows sales up 20%, marginally above prior two weeks 19% surge, reflecting improvement in fast-casual and quick-service chains, partly offset by a downtick for casual dining. Segment-wise: casual dining +1%, fast-casual +28%, and quick-service +20%.
Analysis suggests weather conditions may have been slightly favorable vs. the same weeks in 2022 that aided sales for week ended February 5 as per Baird reports. Also, in 2022 mid-to-late February, omicron issues began to fade marking closure to pandemic era.
Stocks on radar: BJ's Restaurants (BJRI); Dutch Bros (BROS); The Cheesecake Factory (CAKE); Chuy's (CHUY); Chipotle Mexican Grill (CMG); Domino's Pizza (DPZ); Darden Restaurants (DRI); Jack in the Box (JACK);El Pollo Loco (LOCO); McDonald's (MCD); Portillo's (PTLO); Restaurant Brands International (QSR); Starbucks (SBUX); Shake Shack (SHAK); Texas RoadHouse (TXRH); Wingstop (WING); Yum! Brands (YUM)