RBD - Restaurant Brands

[winner69]

Carls Jnr still averaging $38k a week a store

With 2 new stores by year end Carls sales just over $18m - up 27% on last year

Stil haven't worked if its this Carls growth or just overall growth (mainly KFC) that's driving the shareprice

Whose caring anyway......not me

[bull....]

KFC driving the share price because its there biggest earner

[Harvey Specter]

KFC driving the share price because its there biggest earner

I think it is both. The growth opportunities from Carl Jr are huge. Imagine if they had as many stores as BurgerKing - and still turned over as much as they are currently.

Forgot to add - and they can keep expanding from cashflow so no need to tap shareholders for extra capital.

[Beagle]

Carls Jnr still averaging $38k a week a store

With 2 new stores by year end Carls sales just over $18m - up 27% on last year

Stil haven't worked if its this Carls growth or just overall growth (mainly KFC) that's driving the shareprice

Whose caring anyway......not me

User feedback - I had high hopes for a decent burger and chips when Carl's Jnr first started up. To start with they were great, hot large burgers with plenty of fresh content and piping hot chips served with a smile to your table with good service and nothing was too much trouble, the staff always had tomato sauce sachets on hand and it was all good.

Fast forward many months and the service and product has really hit the skids and my favourite combo has gone up a dollar to $12.90.
Why is it that the burgers are NEVER hot, the chips are very seldom hot, (lukewarm is the norm for both burger and chips), the staff never have tomato sauce on hand so you have to wait till they go back and get it and by the time they eventually return your burger and chips are even less lukewarm than they were. Customers are voting with their feet and my closest store in Avondale Auckland has seldom got more than a handful of people in it.

The other day just for the sake of an experiment, we went to our local favourite Chinese takeaways just around the corner and I ordered an egg burger with an extra egg and fries for a total of $6. My wife had her usual favourite Chinese dish. All were served a few minutes later piping hot and there was plenty of hot fries. I'm over Carl's Jnr. I wouldn't feed my dogs with the rubbish the local KFC cooks up, likewise the local Pizza Hut.

Maybe I've become too discerning ?

[Snoopy]

User feedback -
<snip>
Maybe I've become too discerning ?

Perhaps you are not in Restaurant Brand's target market demographic Roger? Not every food consumer has the same needs or wants. That doesn't mean you can't invest in a company because it only satisfies the needs or wants of others.

From the employee standpoint, I don't think RBD discriminate in wages because of age. And they tend to pay above minimum wage rates too, IIRC.

SNOOPY

[Harvey Specter]

Perhaps you are not in Restaurant Brand's target market demographic Roger? Not every food consumer has the same needs or wants. That doesn't mean you can't invest in a company because it only satisfies the needs or wants of others.

From the employee standpoint, I don't think RBD discriminate in wages because of age. And they tend to pay above minimum wage rates too, IIRC.

SNOOPY

I also dont think the Avondale one is a RBD one either. very confusing and could effect there reputation to have to master franchisors.

[percy]

Perhaps you are not in Restaurant Brand's target market demographic Roger? Not every food consumer has the same needs or wants. That doesn't mean you can't invest in a company because it only satisfies the needs or wants of others.

From the employee standpoint, I don't think RBD discriminate in wages because of age. And they tend to pay above minimum wage rates too, IIRC.

SNOOPY

Still must not pay enough, as half the staff at Linwood KFC did not turn up for work last Sunday.!

[psychic]

Gotta say I've shared Rogers experience, found em superb originally, wouldn't go out of my way now.
Grabbed a Carls in Singapore recently. Very plain. Irrelevant maybe but left me with the impression they not worried with consistency that perhaps Maccas are.
KFC on the other hand has seen me back lately after years of absence.
Just sayin...

[Beagle]

Perhaps you are not in Restaurant Brand's target market demographic Roger? Not every food consumer has the same needs or wants. That doesn't mean you can't invest in a company because it only satisfies the needs or wants of others.

SNOOPY

Maybe, maybe not, I've certainly always enjoyed a bloody good decent hot burger and fresh hot chips in a clean sit down environment, seems something of a shame I have to pay Burger Fuel prices to get that. Anyway speaking of lukewarm, looking at Reuters 2 analysts have RBD as outperform and one as underperform. Weighted average consensus EPS for Feb 2015 is 21.83 cps which put them on a forward PE of 15.7 times at $3.42. It does seem like there's some growth coming as consensus EPS is 24.53 cps for 2016.
I guess it sheets back to whether you believe in what they're doing or not or have more appetite elsewhere

[winner69]

On paper RBD has looked like a "cheap" or "value" stock for years. If one ignores the chart, and never visits the stores, I can easily see how they could rationalise buying RBD.

Before buying this stock, do three things and ponder one other.

To do :

(a) Call a Pizza Hutt "helpdesk", far removed from the store that makes and delivers your pizza. Note disinterested tone. Wait till pizza and the bill arrives - in an attempt to fight Hell Pizza, note they've half achieved this. Rather than being the "cheap family" option, Pizza Hutt have moved half way away from this - they are now not as cheap as Dominos, and not as good as Hell. Quality has improved. Prices have gone up a little. Where are they now? Slap bang in the middle. Who wants to be there?

(b) Call into your local Starbucks. Note that coffee takes a while to make. Snack food is crappy, ambience is minimal - it is all about the coffee. Coffee selection is vast and personalised - they can't prepare 25 cups in advance. Result? Slow. Limited space for staff to move around, limit to how many you could have. Labour intensive. Note what happens during peak time - sometimes a queue stretching outside. That sounds good - the reality is, this business can't "ramp up" or go much faster than it does. There is a reason most coffee shops are owned by owner operators who just own one. Henry Ford would struggle to "production line" this business any more than it currently is, and currently, its slow.

(c) Go into your local KFC. My god. Talk about little shop of horrors. How can this place be their jewel? 9/10 times staff of a certain ethnic group are having a great time talking to their friends. Have twice seen a ball game being enjoyed by staff and "customers" (their mates who don't buy stuff). Have observed product being handed out more than once. Have seen customers ignored for friends many times. No signs of management supervision. Food totally inconsistent. Have been into two revamped stores - all the bright, fresh backdrop did for me is highlight how bored, uncaring and unsupervised the staff were, and how drab the food is.

To ponder :

There are three things you need to sell chicken, coffee and pizza. Buildings, a business model, and management/staff.

As I understand it, they lease their buildings. They pay YUM a fee for the intellectual property, brand and business model.

What is left? What can Restaurant Brands as a company bring to the party?

Management and staff. The ONLY way there is upside in this stock (cheap as it always looks) is if management runs the stores a lot better, actually supervises the staff, and create an environment of real enthusiasm.

If profits accidentally improved by pure good luck, YUM would go for more money, the landlords would go for more money. Thats life - those two groups are working for themselves, not for shareholders.

The only people working for shareholders - and able to create wealth for shareholders - are management and staff.

Except they're not. Thats the problem. I see no signs of them fixing it.

Even 8 years ago RBD was stuffed and a dog with no future and a shareprice wallowing around the $1 mark

Seems they just keep selling greasy chicken, warm burgers, crappy pizzas and coffee and chocolate drinks under the guise of a coffee shop .....and churning out the cash

Way it's going shareprice over 4 bucks this year .....what's to stop it