In our newest biweekly product, we look at valuations across the restaurant industry categorized by specific sub-sectors. While these posts will primarily consist of charts, we have a few notable callouts in this week’s addition:
- For the most part, we've seen a healthy correction in early 2014 across most of the industry.
- Rising coffee prices and slowing domestic traffic trends at SBUX led to a notable correction in the valuation of the Coffee Category.
- Rising cheese prices led to a notable correction in the valuation of the Pizza Category.
- Rising seafood, beef and produce prices have not yet led to a notable correction in the valuation of the Fine Dining Category. We believe this day will soon come and have positioned accordingly – short DFRG.
- From both a historical and relative perspective, the Fast Casual Category looks like the most attractive one in the restaurant space as PNRA, PBPB and NDLS have struggled of late. FRGI is an intriguing story that we intend to familiarize ourselves with over the coming weeks. It appears, to some extent, that the Street has not yet acknowledged it as a true fast casual competitor.
Please note that the valuation tables below include the minimum, maximum and average valuations from 2010 and on.
Casual dining category
family/fine dining category
fast casual category