03-18-2020, 11:46 PM
(03-18-2020, 05:07 PM)fenders53 Wrote:(03-18-2020, 04:52 PM)vbin Wrote: Folks who have been buying restaurant brands, why no one is looking at QSR? I think buffet is invested and if things get worst cost effective fast food will do well.
We really need to summon Eric for a quick look at balance sheets for any restaurant we are considering. (even if I sass him sometimes lol). That is going to be critical to any restaurant's survival. MCD, WEN etc can go drive thru only and pay the rent and utililities. I am pretty deep in CBRL and will have a decent position in TXRH. Large scale carryout may not be so viable for them. I bet they get more efficient at it by next week though.
Everyone beware this is my idea of a speculative move. My port is dominated by UTEs, insurance companies, defense and bluechip industrials. I don't own tech or much anything shaky other than FUN. This is a time for risk management. Don't add more risk if you already have enough. The index may drop another 25% for all I know. It's my strong belief that if our top 10 national restaurant chains can't survive this, we have big trouble that will go far beyond cheeseburger joints.
QSR is loaded up with debt after the Burger King acquisition, and is also junk rated at BB.
We are in the midst of an unprecedented hit to the restaurant industry and the economy. If things turn around, companies like this might work out, but for me personally, I wouldn't be interested in anything with less than a BBB+ credit rating.
MCD, SBUX, SYY at "BBB+" and potentially DRI at "BBB" are enough risk for my tastes.