The fast food stocks benefitting from value, premium offerings

00:00 Brian

We have gas prices north of $6 a gallon in the huge fast food market of California because of the Iran conflict. Yet the CEOs of Dutch Bros and Chili’s have come on this show the past two weeks to discuss accelerating sales gains in their respective first quarters. Burger King’s viral US president Tom Curtis visited me last week on set with five revamped whoppers and told me how BK just posted a huge quarter of its own.

00:24 Speaker A

I think consumers are incredibly thoughtful right now on how they’re spending their money and as we look at our value proposition, we have one of the strongest value propositions in the industry. I think that they’re loving showing up at the window and everyone needs a little brightness in their day.

00:44 Speaker B

We will go where the consumer guides us. Right now, our consumers are telling us that they want to come into a restaurant. We’ve proven to ourselves that if you do offer a better experience and a better core product, that you can absolutely grow.

01:03 Kevin

When you listen to these earnings calls about the consumer pulling back, the reality is the consumer is waiting for great value, and you’re going to get great value with chili’s and that’s why we’re winning market share right now.

01:13 Brian

I love seeing Kevin there in his uh Chili’s shirt and then uh BK over there, uh Tom Curtis with his Burger King pin. But I sure will mention uh McDonald’s stock has been burning a lot of fat, just reaching lows not seen since August 2024. Wendy’s stock has gone up in flames because of atrocious first quarter. Now 83-year-old billionaire and former Wendy’s chair Nelson Peltz is reportedly circling the drain on Wendy’s with a big. Guys, it’s been interesting to see this. Brooke, I’m coming over to you because you and I have had a lot of these conversations with these fast food executives.

01:45 Brian

There seems to be a real um difference between companies that focus on the higher-end consumer and the low-end consumer and how these chains are doing.

01:58 Brooke

Brian, I was actually even just so to broaden this out even more when you think about the consumer overall, I was talking to the on holding aka on running co-CEO last night. And and what he was saying was that in this sort of environment, there’s this aspirational consumer. and I couldn’t help but think of our conversations with Starbucks CEO Brian Nickel and Dutch Bros CEO Christine Barone. I mean, this is a consumer that if they want to go out and spend $9 on say a latte or an energy refresher, they’re going to do it. But at the same time, you have a company like McDonald’s competing for that same consumer, so balancing those extra value meals for that maybe low and middle-income consumer who are under pressure right now even more so, but then that premium consumer who’s maybe saying, hey, I can go out and spend on that big arch burger. I think this is an…