Restaurants/Pubs

Chipotle partly fulfills Bill Ackman’s order

26 Apr 2017

Recovering sales at the $14 bln burrito chain helped keep the pushy investor's big bet on a roll. A new payments data breach could make investors queasy again, though. Chipotle has a long way to go before it cooks up the kind of return Ackman's Pershing Square typically craves.

Yum China slowly cooking up value for investors

6 Apr 2017

Separating KFC owner Yum Brands from its Chinese unit has yet to bring super-sized returns for shareholders. At least same-store sales in the People’s Republic are improving, especially at Pizza Hut. Drawing up recipes for corporate value creation is easy. Delivery takes time.

Baked-in premium makes Panera a fattening morsel

3 Apr 2017

The $6.6 bln bakery chain has leavened its growth rate with new mobile ordering and delivery services, which has buyers circling. An 8 pct price jump pushed its valuation to new highs. Buying the company, like eating one of its 720-calorie pecan rolls, could produce indigestion.

Darden owners get too gluttonous over cheesy deal

28 Mar 2017

Shares of Olive Garden's parent had their best day in nine years after snagging rival casual-dining chain Cheddar’s for $780 mln. It's a decent enough deal, and scale helps improve margins in the restaurant trade. But it hardly merits a rally equal to the price paid.

Starbucks embarks on ultimate market test: Italy

28 Feb 2017

Howard Schultz wants to woo espresso-mad Italy, which inspired his $82 bln creation, with its first-ever swanky "Roastery" in Milan. Italians have long resisted filter coffee. But depressed real estate and a partnership with an artisan baker could give Schultz the jolt he seeks.

Cox: Trump’s labor secretary is more about capital

30 Jan 2017

Burger-joint entrepreneur Andrew Puzder, the nominee to run the U.S. Labor Department, co-wrote a 2010 book offering a turgid - if mercifully brief - manifesto on how to get people working. But Puzder's jobs may lack the qualities the government agency was created to champion.

Heineken can go another round in pub brawl

15 Dec 2016

The Dutch brewer and its partner have topped up a cash offer for Punch Taverns to 403 mln pounds. Investors are thirsty for more, possibly from a rival suitor. Heineken could keep up a bit longer in a bidding war before the financial return left any strategic merits tipsy.

Heineken’s UK pub binge not as retro as it looks

14 Dec 2016

The Dutch group has offered 390 mln pounds for Punch Taverns in a bid to triple its holdings of British drinking houses. Though most brewers got out of the business long ago, pubs are a petri dish to try out new products. A rival bidder may force Heineken to pay more, though.

China is still firmly on the menu for McDonald’s

8 Dec 2016

The U.S. burger giant is nearing a $2 bln sale of its local unit to an investment consortium. Viewing this as a simple retreat is tempting but misguided. As elsewhere, franchising is a better business than owning and operating stores. A big Chinese partner brings myriad benefits.

Chipotle recipe is deep inside activist cookbook

7 Sep 2016

Pushy investor Bill Ackman bought a 10 pct stake in the struggling burrito chain, but hasn't revealed his plans. Previous stakes in Burger King, McDonald's and Wendy's have few obvious parallels. Creative finance can't fix Chipotle's real problem: reviving a damaged brand.

Restaurant Group self-criticism bitter but healthy

26 Aug 2016

Bigger companies could learn from the UK restaurant chain’s honesty. It blamed a like-for-like sales fall of 3.9 pct on ill-thought-out menu changes, bad pricing and poor service. Closing stores helps, but stimulating demand is more important than tinkering with expansion plans.

McDonald’s super-sizes its faith in the Windy City

13 Jun 2016

The Golden Arches’ move from the suburbs to Chicago proper shows tech and finance aren’t alone in seeking big-city talent. It’s not just another sign of urbanization. It’s a vote of confidence in the junk-rated city, though Mayor Rahm Emanuel still has his work cut out for him.

Turnaround whizzes 3G could shake up diversity too

13 Jun 2016

The Brazilian investors aim to revitalize stodgy brands like Burger King. There’s work to do on their boards, though. The restaurant holding company’s all-male lineup looks very 20th century. A shareholder failed to force action, but 3G risks distraction if it doesn’t catch up.

Digesting Krispy Kreme may require more sweetener

9 May 2016

JAB has baked a 25 pct premium into its $1.4 bln offer to take the donut maker private. The billionaire-backed owner of coffee sellers Keurig and Peet’s should be able to boost sales and margins. But Krispy Kreme may prove too appetizing for others to pass up without a fight.

Too many cooks spoil UK restaurants’ broth

29 Apr 2016

Shares of the Restaurant Group, owner of the Chiquito chain, dropped a fifth after it warned of slower sales, hit by lower footfall in shopping malls. The sector is also gorging on overexpansion. New stores are opening at twice the speed of consumer spending on eating out. 

Chipotle pay a few ingredients short of a burrito

17 Mar 2016

The U.S. fast-food chain is tying 2016 equity bonuses exclusively to its share price after a food poisoning fiasco consumed $9 bln of market value. It’s too simplistic, encourages bosses to think short term and fails to address all-important qualitative food safety concerns.

An activist loss marks a win for all shareholders

16 Mar 2016

The board at U.S. restaurant chain Bob Evans, a third of which was installed by pushy investor Thomas Sandell, nixed his call for a breakup. The law demands fealty to the company first. Seeing representatives of aggressive owners take that duty seriously is a reassuring sign.

Refreshing candor springs from Jack in the Box

18 Feb 2016

The fast-food chain isn’t blaming currency, the weather or other such issues for an earnings miss that sent its stock slumping 18 pct. It’s being much more forthright: the new all-day breakfast from rival McDonald’s whacked prices. Such honesty is rare – and is to be applauded.

Cox: Two signs of M&A bacchanal’s last hurrah

1 Dec 2015

The boom just topped $4 trln, helped along by one telltale massive deal and another much smaller one. Pfizer’s takeover of Allergan is clearly predicated on exploiting tax loopholes while a U.S. retailer is getting into the pizza racket. Both indicate a cycle well past its peak.

Yum split offers value with chance of aftertaste

20 Oct 2015

The KFC parent will hive off its troubled China business into a separate traded company - as suggested by activist Corvex. It’s logical: the two parts are effectively separate already. The catch is that the U.S. unit will still share Chinese growth risks, but without the control.