Shares of restaurant companies with multiple brands, such as Brinker, Darden, and Restaurant Brands International, have outperformed single-chain stocks like McDonald's and Chipotle this year. Brinker's shares are up roughly 32%, Darden's by 18%, and Restaurant Brands International's by 12% year to date. These companies own a variety of restaurant chains, including Chili's, Olive Garden, LongHorn Steakhouse, Burger King, and Tim Hortons.
Next week, major restaurant companies will begin reporting their quarterly earnings, providing insight into whether owning multiple brands offers a competitive advantage. Some Wall Street analysts suggest that having multiple brands can protect a company from weaknesses in one chain, while others argue that focusing on a single business may lead to better performance.
Restaurant stocks have shown a sharp divide this year, potentially linked to the number of brands they own. The performance of these companies will be closely watched as they release their earnings reports.