What makes quick-service restaurants a good investment?

Quick-service restaurants (QSRs) often make attractive investments due to their consistent consumer demand, scalable business models, and ability to perform across different economic environments. Unlike luxury goods, people tend to eat out regardless of economic conditions, though they may select more affordable options during downturns—which typically benefits fast-food chains. Additionally, these companies often generate steady cash flow through franchise models and have opportunities for global expansion.

What are "fast-casual" restaurants?

Fast-casual restaurants represent a category between traditional fast-food and full-service restaurants. They typically offer higher quality food with fresher ingredients than fast-food, slightly higher prices, and a more upscale dining environment, but still maintain the convenience of quick service. Companies like Chipotle (CMG) and Shake Shack (SHAK) are examples in this portfolio. The fast-casual segment has grown significantly as consumers seek better quality food without the time commitment of a full-service restaurant.

How does digital technology affect these companies?

Digital technology is transforming the quick-service industry in several important ways. Mobile ordering apps, loyalty programs, and delivery partnerships are creating new sales channels and improving operational efficiency. Digital tools also provide valuable customer data for personalized marketing and menu optimization. Companies investing in these technologies often see benefits like higher average order values, improved customer retention, and reduced labor costs. This digital transformation represents one of the biggest growth opportunities for companies in this portfolio.

What does "Dividend Yield" mean for these stocks?

Dividend yield represents the annual dividend payment as a percentage of the current stock price. For example, if a stock costs $100 and pays $3 in annual dividends, the dividend yield is 3%. Many established fast-food companies like McDonald's (MCD) have historically paid consistent dividends, making them attractive to income-seeking investors. A higher dividend yield can provide a steady income stream regardless of stock price fluctuations, though younger, growth-focused companies in the portfolio might reinvest profits rather than pay dividends.

What factors affect the performance of convenience and fast-food stocks?

Several key factors drive the performance of these stocks: consumer spending patterns, food commodity prices, labor costs, real estate/rent expenses, competitive pressures, international expansion success, technological adoption, and changing consumer preferences toward health and sustainability. These companies must balance maintaining affordable prices with managing rising costs, while also adapting to evolving consumer expectations. Their ability to navigate these challenges while growing their customer base and locations typically determines their success as investments.

16 handpicked stocks

Convenience & Cravings Portfolio

Discover a collection of companies mastering the art of on-demand satisfaction. These stocks represent market leaders in fast food, quick-service, and convenience retail, expertly selected by our analysts for their strong brands and consistent customer demand.

Han Tan | Market Analyst

Published on June 17

Top Picks from This Group

Here are a few of the assets in this group. Create an account to unlock the full list.

McDonald's Corp.

MCD

Current price

$299.88

As a global icon of the fast-food industry, it exemplifies operational efficiency and brand dominance in the convenience meal sector.

Yum! Brands, Inc.

YUM

Current price

$151.35

Its diverse portfolio of major quick-service brands like KFC, Taco Bell, and Pizza Hut caters to a wide range of consumer cravings.

Restaurant Brands International

QSR

Current price

$67.68

This company owns a powerful trio of convenience-focused brands: Burger King, Tim Hortons, and Popeyes.

Chipotle Mexican Grill, Inc.

CMG

Current price

$40.27

Wendy's Company, The

WEN

Current price

$9.41

Jack in the Box Inc.

JACK

Current price

$20.34

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12 Month Growth Potential

Use the growth calculator to see how much investing in these assets could return over one year, based on aggregated analyst sentiment provided by Refinitive Ltd.

If you invested across these assets:

≈

In 12 months it might be worth:

$1,000.00

+90.54%

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About This Group of Stocks

Our Expert Thinking

This portfolio focuses on companies that excel at delivering immediate satisfaction through efficient service and familiar products. They've built powerful brands that become default choices when consumers seek quick, reliable options—making them resilient across economic cycles.

What You Need to Know

These stocks represent established leaders in fast-food, fast-casual dining, and convenience retail. Their business models typically show consistent demand and pricing power, offering exposure to a relatively stable consumer sector that provides everyday essentials.

Why These Stocks

We've selected companies with strong brand identities, extensive operational footprints, and demonstrated ability to evolve with changing consumer habits. Their integration of digital technology—from mobile ordering to loyalty programs—offers significant growth potential.

Group Performance Snapshot

90.54%

Average 12 Month Profit

On average, analysts expect assets in this group to grow 90.54% over the next year.

13 of 16

Stocks Rated Buy by Analysts

13 of 16 assets in this group are rated Buy by professional analysts.

Source: Analyst sentiment is provided by Refinitiv Ltd, a global leader in financial market data with over 40k business clients. Refinitiv Ltd is an independent third party to Nemo. This is not advice.

Why You'll Want to Watch These Stocks

🍔

Food That Fuels Portfolios

These brands have perfected the science of consistent demand. While other sectors fluctuate, people always need quick, familiar meals—making these stocks remarkably resilient through economic ups and downs.

📱

Digital Revolution in Fast Food

The quick-service industry is being transformed by mobile ordering, loyalty programs, and delivery partnerships. These technological advances are creating new growth opportunities and improving profit margins.

🌎

Global Appetite for Convenience

These companies are expanding worldwide, bringing their efficient service models to new markets hungry for Western-style convenience. International growth represents a massive opportunity that many investors overlook.

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