As the Q1 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the traditional fast food industry, including Dutch Bros (NYSE: BROS) 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.

While some traditional fast food stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1.7% since the latest earnings results.

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. This print exceeded analysts’ expectations by 3%. Overall, it was a strong quarter for the company with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ EPS estimates.

Dutch Bros achieved the biggest analyst estimates beat and fastest revenue growth of the whole group. Unsurprisingly, the stock is up 18.4% since reporting and currently trades at $69.99.

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

El Pollo Loco (NASDAQ: LOCO)

With a name that translates into ‘The Crazy Chicken’, El Pollo Loco (NASDAQ: LOCO) is a fast food chain known for its citrus-marinated, fire-grilled chicken recipe that hails from the coastal town of Sinaloa, Mexico.

El Pollo Loco reported revenues of $119.2 million, up 2.6% year on year, outperforming analysts’ expectations by 0.6%. The business performed better than its peers, but it was unfortunately a mixed quarter with a decent beat of analysts’ EBITDA estimates but a slight miss of analysts’ same-store sales estimates.

The market seems happy with the results as the stock is up 11% since reporting. It currently trades at $10.47.

Is now the time to buy El Pollo Loco? 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 6.6% since the results and currently trades at $7.62.

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

Yum! Brands (NYSE: YUM)

Spun off as an independent company from PepsiCo, Yum! Brands (NYSE: YUM) is a multinational corporation that owns KFC, Pizza Hut, Taco Bell, and The Habit Burger Grill.

Yum! Brands reported revenues of $1.79 billion, up 11.8% year on year. This result came in 2.6% below analysts' expectations. Overall, it was a slower quarter as it also recorded a miss of analysts’ EBITDA estimates.

The stock is down 6% since reporting and currently trades at $138.72.

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

Papa John's (NASDAQ: PZZA)

Founded by the eclectic John “Papa John” Schnatter, Papa John’s (NASDAQ: PZZA) is a globally recognized pizza delivery and carryout chain known for “better ingredients” and “better pizza”.

Papa John's reported revenues of $518.3 million, flat year on year. This number surpassed analysts’ expectations by 0.6%. Taking a step back, it was a mixed quarter as it also logged a narrow beat of analysts’ same-store sales estimates but a significant miss of analysts’ EBITDA estimates.

The stock is up 47.2% since reporting and currently trades at $49.09.

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

Market Update

The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.

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