Restaurants Industry: Restaurants Weekly: European tour

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Restaurants Industry: Restaurants Weekly: European tour

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Restaurants Industry

Restaurants Weekly: European tour

Price Objective Change

Durable brands 13 June 2026

Last week we were in Boston and this week we completed our European tour. Starbucks Equity

was topical on both sides of the Atlantic, though we detected a bit more enthusiasm for United States

the stock - and for the coffee - in the US (we land firmly in the camp of being bullish on Restaurants

both). Among the European investors we spoke to, by contrast, the global growth

company of choice seems to be Yum! Brands. But what makes this contrast so notable to

me is that it’s the exact same split we observed 17 years ago on my very first European

marketing trip. We can think of few better testaments to the durability of these large

restaurant brands than that.

Growth gets cheaper

Beaten down growth companies also came up in both sets of conversations as

valuations have compressed steeply. These include Chipotle and Wingstop and to a

lesser extent Domino’s. For CMG and WING, the most commonly voiced concerns were

about competition from similarly positioned concepts and about the pace of store View Transcript

growth for each system. For DPZ, while competition is clearly a salient concern, the

more pressing worry is about the health of the pizza category more broadly. Our recent Sara Senatore

Research Analyst

work on the topic suggests that the headwind from third party aggregator growth has BofAS

actually been diminishing over the last three years, not increasing. +1 646 743 2110 sara.senatore@bofa.com

Wage rates and restaurant plates IsiahResearchAustinAnalyst

For our part, we ascribe much of the slowdown for all three to broader softening in BofAS isiah.austin@bofa.com