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Positive Restaurant Trends Faltering As Q3 Starts, Morgan Stanley Says

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As COVID-19 cases reach record highs in California, Florida and Texas, daily seated diner trends have stabilized down 65% in the past two weeks, according to Morgan Stanley.

A surge in the number of cases combined with newly imposed post-lockdown restrictions could "further weigh on trends going forward," analyst John Glass said in a Monday note.

The number of total U.S. seated diners declined 62% in the week ending July 11, the analyst said, compared to two weeks ago with only a 59% decline.

The new restrictions not only limit consumer options for dining out but also "impact customer desire to dine out," he said.

Daily OpenTable data shows that levels have been down 60%-65% — aside from July 4 and this last weekend — and have remained this way since late June, Glass said.

"All other states but NY have also started to show slower numbers according to 7-day averages of seated diner growth and we'd expect this to continue near term as cases rise in many populous states.

 

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