Removing MCD from the LONG Bias list
MCD's weekly traffic trends have significantly decelerated since the beginning of August.
McDonald's stock tends to be a favorite in times of concern for the restaurant industry, like rising gas prices and student loan payments. The current bull case for McDonald's is due to a "best" burger innovation, digital initiatives, and value offerings. None of this is helping short-term traffic trends, which are collapsing. We have concerns about the company's aggressive pricing over the past few years.
QSR Traffic Dives
Looking at WoW trends in the QSR segment, traffic declined 390bps to (-6.8%). This brings September MTD of (-4.7%) versus August decline of (-2.4%).
Casual Dining
Looking at WoW trends in the Casual Dining segment, traffic declined 51bps to (-7.3%). This brings September MTD of (-7.0%) versus August decline of (-3.3%).
OpenTable
OpenTable, collects vast amounts of data from its users and partner restaurants is a measure of how independent restaurant operators are performing. By observing reservation trends, OpenTable can glean insights into broader economic conditions, such as consumer spending habits in the dining sector. As you can see from the chart below the OpenTable trends are following the broader chain level data that can be seen in the charts above. This is bad news for Food distributors like USFD, SYY, PFGC and CHEF.
