March 7, 2024
Top 10 Stock Restaurant Brands International Strong Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Restaurant Brands International – Top 10 Stock in Toronto Stock Exchange Index TSX Composite
Restaurant Brands International is listed as a top 10 stock on March 07, 2024 in the market index TSX Composite because of its high performance in at least one of the Obermatt investment strategies. Three consolidated Obermatt Ranks are above-average. Only the Value Rank is below average. The investment rationale may be an investment in future growth, supported by professional market opinion. Based on the Obermatt 360° View of 78 (top 78% performer), Obermatt assesses an overall strong buy recommendation for Restaurant Brands International on March 07, 2024.
Snapshot: Obermatt Ranks
| Country | Canada |
| Industry | Restaurants |
| Index | TSX Composite |
| Size class | X-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Restaurant Brands International Strong Buy
| 360 METRICS | March 7, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 30 |
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| GROWTH | ||||||||
| GROWTH | 92 |
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| SAFETY | ||||||||
| SAFETY | 59 |
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| SENTIMENT | ||||||||
| SENTIMENT | 72 |
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| 360° VIEW | ||||||||
| 360° VIEW | 78 |
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ANALYSIS: With an Obermatt 360° View of 78 (better than 78% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Restaurant Brands International are very positive. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Restaurant Brands International. The consolidated Growth Rank has a good rank of 92, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. This means that growth is higher than for 92% of competitors in the same industry. The consolidated Safety Rank at 59 means that the company has a financing structure that is safer than 59% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a good rank of 72, which means that professional investors are more optimistic about the stock than for 72% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 30, meaning that the share price of Restaurant Brands International is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 70% of alternative stocks in the same industry. ...read more
RECOMMENDATION: With a consolidated 360° View of 78, Restaurant Brands International is better positioned than 78% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as above-average growth (Growth Rank of 92), a safe financing structure (Safety Rank of 59), and positive professional market sentiment (Sentiment Rank of 72), it is a solid stock investment where growth may be the strongest driver of the investment rationale, also reflected by institutional investors. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Restaurant Brands International compared with alternatives? You can use the following rule of thumb: The growth rank measures the growth momentum of the company (92% better than peers). The value rank could be the reverse reflection of that (8%). A Value Rank below that level may be assessed as expensive, a rank above that is still good value. Sometimes market sentiment just reflects the past, sometimes the reality. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for Restaurant Brands International positive
ANALYSIS: With an Obermatt Sentiment Rank of 72 (better than 72% compared with alternatives), overall professional sentiment and engagement for the stock Restaurant Brands International is above average. The Sentiment Rank is based on consolidating four sentiment indicators where all but one are above average for Restaurant Brands International. Analyst Opinions are at a rank of 62 (better than 62% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. The Professional Investors rank is also good at 90, which means that currently, professional investors hold more stock in this company than in 90% of alternative investment opportunities. Pros tend to favor investing in this company. In addition, Market Pulse has a rank of 73 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 73% of competitors). But Analyst Opinions Change has a below-average rank of 22, which means that stock research experts are currently changing their opinions for the worse when it comes to recommending this stock. In other words, they are getting more critical of investments in Restaurant Brands International. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 72 (more positive than 72% compared with investment alternatives), Restaurant Brands International has a reputation among professional investors that is above-average compared with that of its competitors. This is an early sign of caution, even if the stock has significantly appreciated. If analysts change their opinions, the stock may become too expensive. If the price is on the way down, the trend may continue. This may be a stock with a good reputation and history, but it may have reached its breaking point by now. Investors should look at the Value Ranks as well. If they indicate trouble, it might just materialize in the future. ...read more
Value Strategy: Restaurant Brands International Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 30 (worse than 70% compared with alternatives), Restaurant Brands International shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Restaurant Brands International. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 86% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 17 which means that the stock price compared with what market professionals expect for future profits is higher than 83% of comparable companies, indicating a low value concerning Restaurant Brands International's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 39 which means that the stock price compared with what market professionals expect for future profit levels is higher than 61% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 19 is also low. Compared with invested capital, the stock price is higher than for 81% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 30, is a hold recommendation based on Restaurant Brands International's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Restaurant Brands International? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Restaurant Brands International only if they reasonably expect the low current profit levels to be transitory. ...read more
Growth Strategy: Restaurant Brands International Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 92 (better than 92% compared with alternatives) for 2024, Restaurant Brands International shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Restaurant Brands International. Sales Growth has a rank of 71 which means that currently, professionals expect the company to grow more than 71% of its competitors. Capital Growth is also above 37% of competitors with a rank of 80, and Stock Returns with the rank of 79 is also an outperformance. Only Profit Growth is low with a rank of 37 which means that currently, professionals expect the company to grow its profits less than 63% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 92, is a buy recommendation for growth and momentum investors. All three operating growth indicators, namely revenue, profit, and capital growth, are showing improvements. This is a good indication of a company with a positive future. That might, at the same time, be the simple reason why profit growth is low. A growing company needs money and thus can't yet show high profit growth. Look out for signs in corporate communication about extra growth efforts costing time and money. If that is the case, Restaurant Brands International is a good growth stock. ...read more
Safety Strategy: Restaurant Brands International Debt Financing Safety above-average
| SAFETY METRICS | March 7, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 49 |
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| REFINANCING | ||||||||
| REFINANCING | 70 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 41 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 59 |
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ANALYSIS: With an Obermatt Safety Rank of 59 (better than 59% compared with alternatives), the company Restaurant Brands International has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Restaurant Brands International is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Restaurant Brands International and the other two below average. Refinancing is at 70, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 70% of its competitors. But Leverage is high with a rank of 49, meaning the company has an above-average debt-to-equity ratio. It has more debt than 51% of its competitors. Liquidity is also on the riskier side with a rank of 41, meaning the company generates less profit to service its debt than 59% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 59 (better than 59% compared with alternatives), Restaurant Brands International has a financing structure that is safer than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Restaurant Brands International are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. ...read more
Combined financial peformance: Restaurant Brands International Above-Average Financial Performance
| COMBINED PERFORMANCE | March 7, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 30 |
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| GROWTH | ||||||||
| GROWTH | 92 |
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| SAFETY | ||||||||
| SAFETY | 41 |
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| COMBINED | ||||||||
| COMBINED | 71 |
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ANALYSIS: With an Obermatt Combined Rank of 71 (better than 71% compared with investment alternatives), Restaurant Brands International (Restaurants, Canada) shares have above-average financial characteristics compared with similar stocks. Shares of Restaurant Brands International are low in value (priced high) with a consolidated Value Rank of 30 (worse than 70% of alternatives). But they show above-average growth (Growth Rank of 92) and are safely financed (Safety Rank of 59, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 71, is a buy recommendation based on Restaurant Brands International's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Restaurant Brands International exhibits low value (Obermatt Value Rank of 30), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 92). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 59) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
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