Is Restaurant Brands International a Buy After Its Recent Earnings?

Here’s why long-term investors should certainly consider Restaurant Brands (TSX:QSR) stock on any meaningful pullbacks from here.

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Canada has a thriving restaurant industry, with over 82,000 restaurants serving a population of over 40 million. The restaurant industry is a major contributor to the Canadian economy, generating billions of dollars in revenue each year. 

Investing in the restaurant industry can be a wise decision for long-term investors. This industry is cyclical, but it has historically shown resilience during economic downturns. 

As a result of their stable business models and high dividend yields, Canadian restaurant stocks can be a good investment for Canadian investors who are looking for a defensive option.

In this article, I will discuss Restaurant Brands (TSX:QSR), one of the top restaurant stocks in the market.

Let’s dive in! 

QSR stock is surging

Restaurant Brands International Inc. has seen its share price soar by 53% over the past year, far outperforming the market. This is good news for shareholders, who are now sitting on significant gains. This stock is also up 41% over the past three years, making long-term investors happy as well.

Restaurant Brands International’s earnings per share (EPS) grew by 22% in the past year. Moreover, the share price increase has outpaced the EPS growth. This suggests that the market is now more optimistic about the company’s prospects.

Institutional buying remains strong

Ronald Blue Trust Inc., a wealth management firm, has acquired shares of Restaurant Brands International Inc. The investment firm has not disclosed the size of its stake, but it said that it believes QSR is a “well-positioned company with a strong track record of growth.”

In addition to Ronald Blue Trust, a number of other large investors have also made changes to their positions in Restaurant Brands International. Legend Financial Advisors Inc. acquired a new position in the company during the third quarter, valued at about $27,000. Spire Wealth Management increased its holdings in Restaurant Brands International by 378.4% during the fourth quarter. The firm now owns 421 shares of the restaurant operator’s stock, valued at $27,000.

If more institutional investors continue to pile into QSR stock, retail investors can breathe much easier knowing they’re investing where the smart money is.

Bottom Line 

Restaurant Brands continues to be my top pick, and my largest portfolio holding. The company’s growth prospects, combined with strong interest from big-named investors, is impressive. Additionally, for those seeking a dividend yield of 2.9%, this is a stock I think is worth considering.

There are few stocks in the market right now that can provide the kind of defensive growth, income, and value Restaurant Brands stock can. There’s a reason this company is trading near its all-time high right now. Indeed, I think much higher highs could be in store for this stock from here.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Chris MacDonald has positions in Restaurant Brands International. The Motley Fool recommends Restaurant Brands International. The Motley Fool has a disclosure policy.

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