2Q Restaurants Preview

Research evidence excerpt

2Q Restaurants Preview

USA | Restaurants EquityJulyResearch17, 2026

KEY STOCKS FEATURED INCLUDE:2Q Restaurants Preview

We provide updated thoughts into 2Q earnings for Buy-rated MCD, WING, TICKER RATING PRICE TARGET

BROS, BRCB, BJRI and FWRG, and Hold-rated YUM and EAT. Black Box data BROS BUY $83.00

(see latest) suggest industry demand has been largely consistent vs C1Q, but BRCB BUY $22.00

we are cautious on select co's and will look for callouts on trends into 3Q as gas FWRG BUY $22.00

prices have moderated (still volatile) and potential lifts from the World Cup both YUM HOLD $147.00

likely not embedded in guides, while some macro/consumer concerns remain.

BROS (Buy, PT $83): increasing our 2Q co-owned SSS to 7%. We raise our 2Q co-owned SSS from

6% to 7%, sl above Cons 6.5%, supported by Second Measure Observed Sales down just -80bps

sequentially vs the 1Q, whereas a 7% est is more conservative at -350bps Q/Q. We think the Myst

energy launch and cont. food rollout have supplemented overall strength in the category. We model

2Q RLM 31.5% above Cons 31.1%, and adj EBITDA $108m vs Cons $106m (co's defn). While we

wait for more info on the 29-store Phx franchise acquisition, we'd estimate approx. $90m of revs at

30% RLM w/ $5m G&A and $5m of lost royalties equating to $15-20m of annual. EBITDA or about

half that in the 2H, which adds 4-5% to '26 EBITDA.

BRCB (Buy, PT $22); increasing our 2Q SSS to 5%. We raise our 2Q SSS from 4.2% to 5% (Cons

4.4%), or ~flat vs the 1Q result, supported by Second Measure Observed sales up +320bps Q/Q,

with mix/traffic slightly less neg than prior ests but still impacted by PHX cannibalization. We think

category & BRCB initiatives (ex: loyalty personalization) driving momentum, and note 3Q will see