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,
-1.30%
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%.
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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,
-0.63%
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.
Related: Chipotle’s stock has fallen for nine straight trading days, on pace for its biggest losing streak since December 2021
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.
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