4 Restaurant Stocks To Play A Likely Turnaround In 2021

Notably, the combination of re-engineering order and delivery process is likely to boost sales in the upcoming periods. Moreover, restaurant operators are focusing on driverless delivery systems to augment sales. This is expected to bring down expenses substantially and ensure safety amid the pandemic.

Moreover, companies have increased their focus on digital innovation, mobile ordering, and loyalty programs. Also, features like online food tracking, touchscreen ordering, LED menu boards, and frictionless payment options, in terms of drive-thru technology, are being worked upon.

Although restaurant operators are witnessing dismal comps compared with the pre-pandemic levels, they are still banking on the COVID-19 vaccine availability. Notably, vaccinations will reinforce confidence in customers to go to an outlet and grab a bite. Also, it will minimize risks of front-line workers associated with this industry.

Meanwhile, Pfizer (PFE Quick Quote PFE - Free Report), Moderna (MRNA Quick Quote MRNA - Free Report), and AstraZeneca (AZN Quick Quote AZN - Free Report) announced the effectiveness of their vaccines. Per reports, the federal government is planning to distribute 7.9 million doses of the vaccines developed by Pfizer-BioNTech and Moderna in the week starting Dec 21.

Here, we have highlighted four stocks that are likely to witness earnings growth in 2021 buoyed by robust sales-building initiatives.

4 Restaurant Stocks to Watch Out For

Given the backdrop, here are four restaurant stocks that are likely to move higher in 2021. With the help of the Zacks Stock Screener, we have zeroed in stocks which carry a Zacks Rank #1 (Strong Buy) or 2 (Buy). These companies have witnessed a sharp rise in the past six months. 

Jack in the Box Inc. (JACK Quick Quote JACK - Free Report) is a restaurant company that operates and franchises through Jack in the Box quick-service restaurants. Shares of this Zacks Rank #2 company have gained 27.5% in the past six months, courtesy of a robust delivery system. Given the high demand for this service, the company has tied up with third-party delivery channels to bolster transactions and sales. It is also expanding its mobile application in a few markets that support order-ahead functionality and payment. The Zacks Consensus Estimate for its 2021 earnings has been revised 13.4% upward in the past 60 days. The Zacks Consensus Estimate for its fiscal 2021 earnings indicates an improvement of 20.2% year over year.

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