3 Stocks to Watch as Restaurant Sales See Biggest Jump in Two Years

The U.S. restaurant industry put up a great show in 2024 and sales have been climbing steadily this year too amid ongoing price pressures. According to the Commerce Department’s retail sales report, sales at U.S. restaurants jumped in March, surpassing expectations.

Restaurant sales grew almost every month last year but unexpectedly fell in February 2025. However, the industry made a solid turnaround to get back to winning ways. Also, the economic scenario is looking better over the past few days, with inflation cooling in March and President Donald Trump pausing his announced tariffs and indicating at trade negotiations with partner nations.

Given the positive sentiment, it would be ideal to invest in restaurant stocks such as Brinker International, Inc. EAT, Domino's Pizza, Inc. DPZ and BJ's Restaurants, Inc. BJRI. These stocks have seen positive earnings estimate revisions in the last 60 days. Each of our picks carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.

Restaurant Sales Jump in March

The Commerce Department reported earlier this month that sales at U.S. restaurants totaled $98.3 billion in March, up 1.8% month over month and the largest jump since January 2023. Sales at restaurants are considered a key indicator of household finances.

This means that despite price challenges, consumers have enough cash in hand, which is allowing them to spend lavishly at restaurants.  This spending spree was backed by overall retail sales growth of 1.4% in March, also the largest gain since January 20923. Inflation rose in the final months of 2024 and early 2025. However, it slowed in February and surprisingly fell in March.

The consumer price index (CPI) fell 0.1% sequentially in March after rising 0.2% in February and beating analysts’ expectations of a rise of 0.2%. This was the first time the CPI declined since May 2020.

Year over year, CPI rose 2.4% in March after climbing 2.8% a month earlier. Core CPI, which strips out the volatile energy and food components, rose 0.1% sequentially in March after advancing 0.2% in February, the smallest rise since June 2024.

Restaurant Sales Poised to Grow

Higher prices have posed significant challenges for restaurant owners as price-conscious customers are more focused on getting good value for their money.  Quick-service restaurants, especially those that prioritize affordability, have managed to stay strong in this tough market.

With price-conscious diners searching for inexpensive meal choices, competition in the value-driven sector has intensified. To attract and retain customers, brands are boosting promotions and offering budget-friendly deals.

Industry players are seeing steady demand for affordable options and competitive pricing tactics. Many restaurants are ramping up their marketing efforts, getting into partnerships, and launching new products to keep customers engaged. According to a report by the National Restaurant Association (NRA), the U.S. restaurant industry is expected to reach $1.5 trillion by 2025.

3 Restaurant Stocks With Upside

Brinker International, Inc.

Brinker International, Inc. primarily owns, operates, develops and franchises various restaurants under the Chili’s Grill & Bar and Maggiano’s Little Italy brands. EAT took over Chili’s, Inc., a Texas corporation, in September 1983 and completed the acquisition of Maggiano’s in August 1995. Chili’s is a preeminent leader in the bar & grill category of casual dining. The brand has been functioning for over the last 40 years.

Brinker International’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 1% over the past 60 days. EAT currently has a Zacks Rank #3.

Domino's Pizza

Domino's Pizza, Inc., which delivers pizzas under the Domino’s Pizza brand, is a top player in the Quick-Service Restaurant or QSR Pizza category. Through its subsidiaries, DPZ operates as a pizza delivery company in the United States and internationally, with 18,800 locations in more than 90 markets.

Domino's Pizza’s expected earnings growth rate for next year is 5.2%. The Zacks Consensus Estimate for current-year earnings has improved 0.3% over the past 60 days. DPZ currently has a Zacks Rank #3.

BJ's Restaurants

BJ's Restaurants, Inc. owns and operates a chain of high-end casual dining restaurants in the United States. BJRI’s menu offers a wide range of dining options, including everyday lunch and dinner, special occasions and late-night business.

BJ's Restaurants’ expected earnings growth rate for the current year is 12.2%. The Zacks Consensus Estimate for current-year earnings has improved 0.6% over the past 60 days. Presently, BJRI has a Zacks Rank #3.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research