Traditional Fast Food Stocks Q1 Recap: Benchmarking McDonald's (NYSE:MCD)

Looking back on traditional fast food stocks’ Q1 earnings, we examine this quarter’s best and worst performers, including McDonald's (NYSE:MCD) and its peers.

Traditional fast-food restaurants are renowned for their speed and convenience, boasting menus filled with familiar and budget-friendly items. Their reputations for on-the-go consumption make them favored destinations for individuals and families needing a quick meal. This class of restaurants, however, is fighting the perception that their meals are unhealthy and made with inferior ingredients, a battle that's especially relevant today given the consumers increasing focus on health and wellness.

The 14 traditional fast food stocks we track reported a slower Q1. As a group, revenues missed analysts’ consensus estimates by 1.3% while next quarter’s revenue guidance was in line.

In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.

McDonald's (NYSE:MCD)

With nicknames spanning Mickey D's in the U.S. to Makku in Japan, McDonald’s (NYSE:MCD) is a fast-food behemoth known for its convenience and broken ice cream machines.

McDonald's reported revenues of $5.96 billion, down 3.5% year on year. This print fell short of analysts’ expectations by 2.7%. Overall, it was a softer quarter for the company with a slight miss of analysts’ same-store sales and EBITDA estimates.

"McDonald's has a 70-year legacy of innovation, leadership, and proven agility, all of which give us confidence in our ability to navigate even the toughest of market conditions and gain market share," said Chairman and CEO Chris Kempczinski.

The stock is down 2.2% since reporting and currently trades at $312.54.

Is now the time to buy McDonald's? Access our full analysis of the earnings results here, it’s free.

Best Q1: Dutch Bros (NYSE:BROS)

Started in 1992 by two brothers as a single pushcart, Dutch Bros (NYSE:BROS) is a dynamic coffee chain that’s captured the hearts of coffee enthusiasts across the United States.

Dutch Bros reported revenues of $355.2 million, up 29.1% year on year, outperforming analysts’ expectations by 3%. The business had a strong quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ EPS estimates.

Dutch Bros scored the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 20.9% since reporting. It currently trades at $71.47.

Is now the time to buy Dutch Bros? Access our full analysis of the earnings results here, it’s free.

Weakest Q1: Arcos Dorados (NYSE:ARCO)

Translating to “Golden Arches” in Spanish, Arcos Dorados (NYSE:ARCO) is the master franchisee of the McDonald's brand in Latin America and the Caribbean, responsible for its operations and growth in over 20 countries.

Arcos Dorados reported revenues of $1.08 billion, flat year on year, falling short of analysts’ expectations by 3.6%. It was a disappointing quarter as it posted a significant miss of analysts’ same-store sales and EPS estimates.

As expected, the stock is down 9.8% since the results and currently trades at $7.36.

Read our full analysis of Arcos Dorados’s results here.

Restaurant Brands (NYSE:QSR)

Formed through a strategic merger, Restaurant Brands International (NYSE:QSR) is a multinational corporation that owns three iconic fast-food chains: Burger King, Tim Hortons, and Popeyes.

Restaurant Brands reported revenues of $2.11 billion, up 21.3% year on year. This number lagged analysts' expectations by 1.8%. It was a softer quarter as it also produced a miss of analysts’ EBITDA estimates and a slight miss of analysts’ same-store sales estimates.

The stock is up 7.3% since reporting and currently trades at $72.80.

Read our full, actionable report on Restaurant Brands here, it’s free.

Wendy's (NASDAQ:WEN)

Founded by Dave Thomas in 1969, Wendy’s (NASDAQ:WEN) is a renowned fast-food chain known for its fresh, never-frozen beef burgers, flavorful menu options, and commitment to quality.

Wendy's reported revenues of $523.5 million, down 2.1% year on year. This print met analysts’ expectations. Zooming out, it was a slower quarter as it logged full-year EPS guidance missing analysts’ expectations and a slight miss of analysts’ same-store sales estimates.

The stock is down 6.8% since reporting and currently trades at $11.64.

Read our full, actionable report on Wendy's here, it’s free.

Market Update

Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.

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