In Canada, there are approximately 82,000 restaurants, and the fast-food industry is constantly developing there. Stocks related to these industries tend to be recession-proof as during difficult times, people like to dine out more than at normal times.
Canadian restaurant stocks are a great choice to shield your investment portfolio from the looming recession. Also, these stocks pay great dividends and significant returns in the long run.
Restaurant Brands (TSX:QSR) is one of those rare stocks that offer dividends, growth, and great overall returns.
Let’s find out why this stock is a great buy in 2023 and should be in your portfolio.
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Restaurant dividends for long-term investors
Restaurant Brands currently offers a dividend yield of 3.2%, which is pretty high considering its peers. The company has increased its dividend payment over the past five years consecutively. Added to that, it has a great payout ratio of 65%. Hence, it is a great option for long-term investors looking for a stable income stream from their investments.
Apart from quality dividends, QSR also offers share buybacks to its investors. For instance, the company has recently received the approval to buy back US$1 billion in shares over the course of the next two years.
As per its second-quarter (Q2) financial report, the company has achieved impressive earnings and sales growth. The net revenue stands at US$351 million, along with a 14% sales growth.
QSR intends to amend revolving credit and extend term loan facility
Restaurant Brands has recently expressed its interest in entering an agreement with its senior secured credit facilities under an amendment. The amendment will include the following conditions:
- Extension of maturity of the existing $5,163 million Term Loan B credit facility till September 2030.
- Extension of maturity of the existing $1,234 million Term Loan A credit facility till September 2028.
- Amendment of the existing Revolving Facility to increase the availability of revolving extension from $1,000 million to $1,250 million as well as extension of the same facility till September 2028.
This agreement is supposed to be closed in the next few weeks, depending on the fulfilment of customary closing circumstances.
Bottom line
Restaurant Brands International is one of the world’s largest quick-service restuarants. It owns four world-famous, quick-service, fast-food retailers: Tim Hortons, Burger King, Popeyes, and Firehouse Subs. It has more than 30,000 restaurants across 100 countries. Long-term investors can consider adding this stock to their portfolio for great overall returns and stable income.
