NoBull Posts
Sysco Fiscal 1Q24: U.S. Foodservice Sales +0.9% Y/Y, International Sales +12%
Sysco expects a return to normal levels of volume growth & inflation for the foodservice distribution industry. Management is confident that food-away-from-home will continue gaining market share from the grocery channel as it has for 24 of the last 25 years, except for 2020 (due to covid).
Strength Through Generosity
A strong military aligned with the U.S. Constitution is a good thing. Endless wars, which are a bad thing, will bankrupt the country both financially & morally. There is a better way…
Coke 3Q23: U.S. Segment Strength
Coca-Cola reported that lower-income consumers are under the most pressure, particularly as it relates to at-home shopping occasions. However, there is a rebound & strong growth in away-from-home channels that extend beyond restaurants to amusement, travel, leisure, and hospitality channels.
3Q23 Real GDP Up +4.9%
Are you wondering how the real GDP grew almost 5% y/y during the third quarter given all the so/so corporate commentary that we have been reporting on? Well, we are also scratching our heads about this “hidden” economic strength… In any case, disposable personal income growth of +7.4% & a +6.7% personal outlay increase portrays a solid consumer through 3Q.
How the Government Can Make Housing Affordable
Uncle Sam has been busy writing checks for pet projects around the world with borrowed money while Americans struggle to afford mortgage and rent payments that have spiraled out of control. We have a simple fix.
Buying a Car is Becoming as Challenging as a House Purchase
Unrelenting borrowing costs continue to make buying new & used cars a challenge for many consumers, according to Edmunds.
Record Total Halloween Spend Expected by NRF
If consumers are strapped for cash, you couldn’t tell by their Halloween spending plans, with expectations for a record-high participation rate and a big spike in adult costume spending. Apparently, people are looking for a party to forget their financial woes and any excuse will do…
Wisdom for a Well-Ordered Life
Thomas Saaty developed the analytic hierarchy process (AHP) theory of decision-making in the 1970’s, providing a structured technique for organizing and analyzing complex decisions based on mathematics & psychology. The Book of Proverbs makes it simple…
Time for a Rate Cut
Everyone is focused on the Fed Fund Rate which does not seem so bad at 5.33% when viewed in the context of historical data. However, in the real world, consumers are forced to borrow at much higher rates as indicated in the following chart. From the perspective of John & Jane Q. Public, it’s way past time for a rate cut – it’s the moral thing to do…
California Dreaming: What Happened in 2022?
Something weird happened in California in 2022: the y/y employment growth rate reached an all-time high while y/y disposable income growth declined to an all-time low. How did this happen with an +83% increase in Federal & State assistance paid to Californians from June 21 to June 23?
RR Posts
Dashboard Capital Markets October 2023
Recent restaurant stock weakness reflects investor concern about slowing industry traffic & increasing consumer weakness, points recently addressed by General Mills.
Denny’s 2023
Denny’s unique “America’s Diner” brand positioning provides the promise of everyday value with craveable, comfort food served around the clock in a friendly and welcoming atmosphere. While Denny’s management team is executing well around a very solid strategy, the chain remains challenged to drive needed AUV growth especially at a time when its core low-income customers remain stressed by unfavorable economic conditions.
Buffalo Wild Wings 2023
Buffalo Wild Wings enjoys a unique positioning as the largest sports bar brand (4th largest casual chain) which is famous for its wings flavored with 26 B-Dub sauces & seasonings in ascending order of heat. While BWW enjoys considerable brand equity as the largest and perhaps most iconic sports bar chain, there remains more work to convince young sports fans that the chain’s dining experience is worth the price premium over Wingstop delivery.
Arby’s 2023
Arby’s strong and unique positioning among $1B+ QSR chains is based upon a credible, affordable NY deli format (with a drive-thru) that bakes beef roasts and freshly slices all other roasts in-house to create fast crafted, made-to-order hot deli sandwiches. While Arby’s has a great business model, it must find ways to reach a higher income demo while it waits for an economic rebound to help its struggling lower-income core customers who love their Arby’s.
Wingstop 2023
Wingstop is the only $1B+ national chain with an exclusive specialization in the chicken wing category and while the chain’s top-line performance has been remarkable so far, work remains to convince customers to extend their usage of the chain beyond a special bone-in treat to more frequent purchases of high margin boneless products sufficient to drive AUVs and store-level margins to levels appropriate for a world class wings player.
Dashboard Capital Markets September 2023
The Philadelphia Fed is forecasting +1.9% real GDP growth for 3Q23 which is significantly lower than the Atlanta Fed’s +5.9% GDPNow forecast.
2Q23 Investor Calls & Same Store Sales
FSR and QSR investor calls and same-store-sales report.
1H23 Restaurant Lending & Valuation Update
Full-year 2023 restaurant originations (excluding sale leaseback financing) are now projected to be $8.3B, -35% lower than initial expectations at the beginning of the year.
Taco Bell 2023
Taco Bell remains one of the best positioned QSR chains, supported by a craveable menu filled with a wide array of abundant value options, compelling brand positioning & marketing, and a material COGs outperformance which provides an important clue about TB’s secret sauce.
Burger King 2023
While Burger King is progressing in finding ways to expand its market reach towards new, more affluent consumers who are willing to pay for the brand’s strong core equities and quality upgrades, the chain’s ongoing turnaround requires more than 2 quarters of strong sales to show that it has progressed beyond its historical struggles.
