Analyzing Restaurant Brands International (QSR) & Its Rivals

Restaurant Brands International (NYSE: QSR) is one of 44 publicly-traded companies in the “Restaurants & Bars” industry, but how does it compare to its peers? We will compare Restaurant Brands International to similar businesses based on the strength of its dividends, institutional ownership, valuation, analyst recommendations, profitability, risk and earnings.

Insider and Institutional Ownership

76.7% of Restaurant Brands International shares are owned by institutional investors. Comparatively, 70.6% of shares of all “Restaurants & Bars” companies are owned by institutional investors. 4.2% of Restaurant Brands International shares are owned by insiders. Comparatively, 20.2% of shares of all “Restaurants & Bars” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Risk & Volatility

Restaurant Brands International has a beta of 1.77, meaning that its stock price is 77% more volatile than the S&P 500. Comparatively, Restaurant Brands International’s peers have a beta of 0.66, meaning that their average stock price is 34% less volatile than the S&P 500.

Dividends

Restaurant Brands International pays an annual dividend of $0.80 per share and has a dividend yield of 1.3%. Restaurant Brands International pays out 55.6% of its earnings in the form of a dividend. As a group, “Restaurants & Bars” companies pay a dividend yield of 3.0% and pay out 61.1% of their earnings in the form of a dividend.

Analyst Ratings

This is a summary of recent recommendations and price targets for Restaurant Brands International and its peers, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Restaurant Brands International 0 3 12 0 2.80
Restaurant Brands International Competitors 369 1699 2174 82 2.46

Restaurant Brands International currently has a consensus price target of $65.00, suggesting a potential upside of 3.14%. As a group, “Restaurants & Bars” companies have a potential upside of 13.74%. Given Restaurant Brands International’s peers higher probable upside, analysts plainly believe Restaurant Brands International has less favorable growth aspects than its peers.

Earnings and Valuation

This table compares Restaurant Brands International and its peers revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Restaurant Brands International $4.32 billion $1.91 billion 43.76
Restaurant Brands International Competitors $2.03 billion $348.56 million -5.85

Restaurant Brands International has higher revenue and earnings than its peers. Restaurant Brands International is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Profitability

This table compares Restaurant Brands International and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Restaurant Brands International 12.66% 22.71% 3.99%
Restaurant Brands International Competitors 1.53% 19.28% 1.61%

Summary

Restaurant Brands International beats its peers on 11 of the 15 factors compared.

Restaurant Brands International Company Profile

Restaurant Brands International Inc. is a quick service restaurant (QSR) company. The Company had over 20,000 restaurants in more than 100 countries and the United States territories, as of December 31, 2016. It operates through two segments: Tim Hortons (TH) and Burger King (BK). Tim Hortons restaurants are quick service restaurants with a menu that includes blend coffee, tea, espresso-based hot and cold specialty drinks, baked goods, including donuts, Timbits, bagels, muffins, cookies and pastries, grilled paninis, classic sandwiches, wraps and soups, among others. Burger King restaurants are quick service restaurants that feature flame-grilled hamburgers, chicken and other specialty sandwiches, French fries, soft drinks and other food items. The Company operates coffee roasting facilities in Hamilton, Ontario and Rochester, New York. The Company sells its raw materials and supplies, including coffee, sugar, paper goods and other restaurant supplies to Tim Hortons restaurants.

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