Skip to main content

Market Overview

Restaurant Analyst Says Delivery, Pickup Separate Winners From Losers

Restaurant Analyst Says Delivery, Pickup Separate Winners From Losers

The one defining characteristic separating winners from losers in the restaurant space is delivery and pickup options, Piper Sandler restaurant analyst Nicole Miller Regan said on CNBC's "Power Lunch."

'Investible Theme' For Restaurants

While delivery and pickup options are vital to a restaurant's survival, more important are unit-level economics that makes sense and the ability to deliver across multiple channels, Miller Regan said. Most notable is the ability to offer a digital ordering platform with embedded delivery options, she said. 

"That's a very investible theme."  

Dine-In Restaurant Chains

High-end dine-in restaurants are closely correlated with corporate spend and will see a much slower rebound versus more leisure-oriented brands, the analyst said.

Encouragingly, leisure brands count their dining rooms for their "base margins" and any pick-up orders to go bring superior margins, she said. 

This is countered by a delivery that is dilutive to margins, but so long as pick-up orders match delivery orders, the company will end up with an unchanged margins profile, Miller Regan said.

Piper Sandler Analyst's Top Restaurant Picks

Companies that Miller Regan recommend include top pick Chipotle Mexican Grill, Inc. (NYSE: CMG) as the chain exits its recovery phase and is set to expand digital growth and unit expansion.

Second-ranked Wingstop Inc (NASDAQ: WING) is an "excellent franchise network" that faces a large whitspace opportunity ahead, the analyst said.

Ranked third is Darden Restaurants, Inc. (NYSE: DRI) due to its "scale and people." The management team consists of "the best of the best of the best," which will ensure its core brands of Olive Garden and Longhorn will "be here in the future," she said. 

Related Links:

Restaurant Brands CEO 'Optimistic' About Burger King Parent Company After Meeting With Trump

Checking In On Restaurants Amid The Coronavirus Lockdown: Timberloft Restaurant

Photo courtesy of Uber. 



Related Articles (CMG + DRI)

View Comments and Join the Discussion!

Posted-In: CNBC delivery Fast FoodAnalyst Color Restaurants Analyst Ratings Media General Best of Benzinga

Latest Ratings

PHXSeaport GlobalInitiates Coverage On
AFCGLake StreetInitiates Coverage On29.0
OSSNoble Capital MarketsUpgrades7.0
NCNOGabelli & Co.Upgrades
HAECJS SecuritiesUpgrades
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at