Looking back on modern fast food stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Wingstop (NASDAQ:WING) and its peers.

Modern fast food is a relatively newer category representing a middle ground between traditional fast food and sit-down restaurants. These establishments feature an expanded menu selection priced above traditional fast food options, often incorporating fresher and cleaner ingredients to serve customers prioritizing quality. These eateries are capitalizing on the perception that your drive-through burger and fries joint is detrimental to your health because of inferior ingredients.

The 6 modern fast food stocks we track reported a mixed Q3. As a group, revenues were in line with analysts’ consensus estimates.

In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.

Wingstop (NASDAQ:WING)

The passion project of two chicken wing aficionados in Texas, Wingstop (NASDAQ:WING) is a popular fast-food chain known for its flavorful and crispy chicken wings offered in a variety of sauces and seasonings.

Wingstop reported revenues of $162.5 million, up 38.8% year on year. This print exceeded analysts’ expectations by 1.6%. Despite the top-line beat, it was still a slower quarter for the company with a miss of analysts’ earnings estimates.

"Our third quarter results demonstrated the staying power of our multi-year strategies we are executing against, delivering 20.9% same store sales growth, primarily driven by transaction growth," said Michael Skipworth, President and Chief Executive Officer.

The stock is down 29.2% since reporting and currently trades at $342.53.

Is now the time to buy Wingstop? Access our full analysis of the earnings results here, it’s free.

Best Q3: Potbelly (NASDAQ:PBPB)

With a unique origin story where the company actually started as an antique shop, Potbelly (NASDAQ:PBPB) today is a chain known for its toasty sandwiches.

Potbelly reported revenues of $115.1 million, down 4.7% year on year, outperforming analysts’ expectations by 1.7%. The business had a stunning quarter with an impressive beat of analysts’ earnings and EBITDA estimates.

Potbelly delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 29.2% since reporting. It currently trades at $10.66.

Is now the time to buy Potbelly? Access our full analysis of the earnings results here, it’s free.

Weakest Q3: Noodles (NASDAQ:NDLS)

Offering pasta, mac and cheese, pad thai, and more, Noodles & Company (NASDAQ:NDLS) is a casual restaurant chain that serves all manner of noodles from around the world.

Noodles reported revenues of $122.8 million, down 4% year on year, falling short of analysts’ expectations by 2.5%. It was a disappointing quarter as it posted a miss of analysts’ earnings estimates.

Noodles delivered the weakest performance against analyst estimates and weakest full-year guidance update in the group. As expected, the stock is down 27.4% since the results and currently trades at $0.87.

Read our full analysis of Noodles’s results here.

Shake Shack (NYSE:SHAK)

Started as a hot dog cart in New York City's Madison Square Park, Shake Shack (NYSE:SHAK) is a fast-food restaurant known for its burgers and milkshakes.

Shake Shack reported revenues of $316.9 million, up 14.7% year on year. This result met analysts’ expectations. Overall, it was a very strong quarter as it also logged a solid beat of analysts’ earnings estimates.

The stock is up 14.3% since reporting and currently trades at $129.84.

Read our full, actionable report on Shake Shack here, it’s free.

Sweetgreen (NYSE:SG)

Founded in 2007 by three Georgetown University alum, Sweetgreen (NYSE:SG) is a casual quick service chain known for its healthy salads and bowls.

Sweetgreen reported revenues of $173.4 million, up 13% year on year. This number came in 1.2% below analysts' expectations. Overall, it was a slower quarter as it also recorded a miss of analysts’ EBITDA estimates and underwhelming EBITDA guidance for the full year.

Sweetgreen achieved the highest full-year guidance raise among its peers. The stock is down 7.1% since reporting and currently trades at $39.21.

Read our full, actionable report on Sweetgreen here, it’s free.

Market Update

As expected, the Federal Reserve cut its policy rate by 25bps (a quarter of a percent) in November 2024 after Donald Trump triumphed in the US Presidential election. This marks the central bank's second easing of monetary policy after a large 50bps rate cut two months earlier. Going forward, the markets will debate whether these rate cuts (and more potential ones in 2025) are perfect timing to support the economy or a bit too late for a macro that has already cooled too much. Adding to the degree of difficulty is a new Republican administration that could make large changes to corporate taxes and prior efforts such as the Inflation Reduction Act.

Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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