CIBC has revised its price target for Restaurant Brands (QSR, Financial), reducing it slightly from $78 to $77, while maintaining an Outperform rating. Despite slower growth than anticipated in the first quarter across the quick service restaurant sector, including Restaurant Brands, the company's market share trends remain solid, according to an analyst's report.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 15 analysts, the average target price for Restaurant Brands International Inc (QSR, Financial) is $76.44 with a high estimate of $85.00 and a low estimate of $68.00. The average target implies an upside of 12.73% from the current price of $67.81. More detailed estimate data can be found on the Restaurant Brands International Inc (QSR) Forecast page.
Based on the consensus recommendation from 18 brokerage firms, Restaurant Brands International Inc's (QSR, Financial) average brokerage recommendation is currently 2.1, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Restaurant Brands International Inc (QSR, Financial) in one year is $95.12, suggesting a upside of 40.27% from the current price of $67.81. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Restaurant Brands International Inc (QSR) Summary page.
QSR Key Business Developments
Release Date: May 08, 2025
- Consolidated Comparable Sales: 0.1%, or just over 1% excluding leap day impact.
- Net Restaurant Growth: 3.3%.
- System-wide Sales Growth: 2.8%.
- Organic Adjusted Operating Income Growth: 2.6%.
- Tim Hortons Canada Comparable Sales: 0.1%, or approximately 1.2% after adjusting for leap day.
- International Comparable Sales: 2.6%, or roughly 3.7% excluding leap day.
- International System-wide Sales Growth: 8.6%.
- Burger King US Comparable Sales: 1.1% decrease, or relatively flat adjusting for leap day.
- Popeyes US and Canada Comparable Sales: Declined 4%, or down roughly 2.9% adjusted for leap day.
- Popeyes US and Canada Net Restaurant Growth: 3%.
- Firehouse Subs Comparable Sales: 0.6%, or nearly 2% excluding leap day.
- Firehouse Subs Net Restaurant Growth: 5.9%.
- Firehouse Subs System-wide Sales Growth: 7.3%.
- Adjusted EPS: Increased to $0.75 per share from $0.73 per share last year.
- Free Cash Flow: $89 million, inclusive of approximately $35 million in cash benefits from hedges.
- Leverage Ratio: 4.7 times.
- Liquidity: $2.1 billion, including approximately $900 million of cash.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Restaurant Brands International Inc (QSR, Financial) reported a system-wide sales growth of 2.8% and organic adjusted operating income growth of 2.6% in Q1 2025.
- Tim Hortons Canada showed resilience with flat comparable sales, supported by innovative promotions and operational improvements.
- The international segment delivered 2.6% comparable sales growth, with strong performances in key markets like the UK, Germany, Brazil, Japan, and Australia.
- Burger King US outperformed the broader burger QSR category, driven by operational improvements and strategic marketing initiatives.
- Popeyes is focusing on operational consistency and modernizing its restaurant base, with plans to roll out easy-to-run kitchen upgrades and remodels.
Negative Points
- Q1 2025 was anticipated to be the softest quarter of the year, with macroeconomic pressures contributing to a slower start.
- Burger King US saw a 1.1% decrease in comparable sales, highlighting ongoing challenges in the market.
- Popeyes US and Canada experienced a 4% decline in comparable sales, attributed to the absence of a Super Bowl ad and increased competition.
- The company is facing a $19 million year-over-year headwind due to the loss of royalties and fees from Burger King China, which is now classified as held for sale.
- Restaurant Brands International Inc (QSR) revised its net restaurant growth expectations for 2025, primarily due to challenges in the Burger King China segment.
