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McDonald’s Corp. and Chipotle Mexican Grill Inc. are outperforming the broader dining sector, according to foot-traffic data from analytics company Placer.ai, despite concerns about consumer spending.
“While year-over-year foot traffic trends indicate that neither chain is immune from the ongoing economic headwinds — both Chipotle and McDonald’s are well-positioned to continue their winning streak,” Bracha Arnold of Placer.ai wrote in a blog post. “McDonald’s and Chipotle have both focused on innovation and menu enhancements in recent years, positioning themselves well to address industry challenges.”
Earlier this month, McDonald’s stock
MCD,
suffered its longest weekly losing streak in four years amid consumer-spending worries. McDonald’s shares have fallen 13.2% in the last three months, outpacing the S&P 500’s
SPX
decline of 6.9%.
While the fast-food giant has seen visits fall in recent months, it is still performing better than the sector, Placer.ai data show. In September, for example, visits to McDonald’s were down 3.7%, but visits were down 4.2% for dining overall.
McDonald’s reports third-quarter results on Oct. 30. Analysts surveyed by FactSet are looking for earnings of $3 a share, sales of $6.553 billion and same-store sales of 7.8%.
Visits to Chipotle
CMG,
were up 4.7% year over year in September, although Placer.ai notes that this is significantly lower than the double-digit monthly visit increases seen earlier in the year. “Consumers’ tightening budgets — as well as comparisons to a particularly strong [third quarter of ] 2022 — may be limiting Chipotle’s growth potential,” Arnold wrote.
Shares of the fast-casual Mexican chain are down 12.3% in the last three months.
Chipotle reports third-quarter results on Oct. 26. Analysts surveyed by FactSet are looking for earnings of $10.55 a share, sales of $2.472 billion and same-store sales of 4.5%.
“By leaning into their strengths — McDonald’s as a rural dining destination with an affordable menu, and Chipotle as a suburban destination popular among diners from higher income brackets — both companies appear well-positioned to continue dominating their respective dining categories,” Arnold wrote.
Tomi Kilgore contributed.
