If you break down the Restaurant Sector for Q1 2015, you’ll find a clear message: the consumer still adores pizza and doughnuts. Earnings and profitability are also telling you that cold weather helped domestic sales for three companies who specialize in the comfort foods – shares of Domino’s Pizza Inc. (DPZ) , Papa John’s Int’l Inc. (PZZA) and Dunkin’ Donuts (DNKN) led restaurant stocks higher today as the group all reported strong earnings.
There were a variety of drivers for the group ranging from currency effects to food costs, but the consumer seems intent on buying coffee, doughnuts and pizza as staples. It was little surprise that the breakfast wars diluted pedigree fast food companies like McDonald’s Corporation (MCD) and owner of Taco Bell and KFC Yum! Brands, Inc. (YUM) , both of which are vying for breakfast market share. Below are some stocks in the sector:
Dunkin Brands Group rose $3.82, or 8.0%, to $51.54.
Chipotle Mexican Grill Inc. (CMG) fell $0.23%, to $641.00.
Darden Restaurants, Inc. (DRI) rose $0.39 or 0.6%, to $65.59.
Domino's Pizza Inc. rose $9.01 or 9.0%, to $108.81.
McDonald's Corp. fell $0.76 or 0.8%, to $97.08.
Panera Bread Co (PNRA) rose $1.66 or 0.9%, to $183.25.
Papa John's International Inc. rose $2.64 or 4.3%, to $63.99.
Starbucks Corporation (SBUX) rose $0.81 or 1.7%, to $49.14.
Wendy's Co. (WEN) rose $0.14 or 1.3%, to $10.58.
Yum Brands Inc. fell $0.07 or 0.1%, to $83.98.
Chipotle Mexican Grill has been trading is lower today at $640 down slightly. More importantly, though, it has been the darling of many portfolio managers since 2012, rallying from $240 p/s to over $700, and until recently has been a core long position for anyone trading the sector.
Today, however, it has shown signs of topping in 2015, as it tests its recent lows with today’s trading activity, as all eyes stay on the $600 level, looking for any close below this important floor. Today’s action from the pizza and doughnut makers is further sign that the sector may have a changing of the guard, and is a sector to watch as the bull market stumbles forward.
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