QSR:CC - This Growth Stock Has Market-Beating Potential
2024-03-31 09:45:00 ET
For those looking to beat the market, investing in companies that can provide consistent outsized growth and profits over time is important. One such TSX stock I continue to pound the table on is Restaurant Brand International ( TSX:QSR ), a network of quick-service restaurants with global geographic exposure.
The company’s core banners include the likes of Canadian favourite Tim Hortons as well as Burger King, Popeyes Lousiana Kitchen, and Firehouse Subs. Here’s more on why I think this is the ultimate stock for investors to buy in 2024.
In good times and bad, this company will perform
In this year’s bull market, it’s easy for any investor to throw a dart at a board and probably generate positive returns. That’s the environment we’re in, which makes index investing look like a much more attractive proposition (especially when many mega-cap stocks continue performing as they have been).
But in an environment where growth slows, sentiment shifts, and investors become increasingly cautious, many growth stocks can underperform. That’s where I think Restaurant Brands differs from many of the tech-focused growth names most investors focus on right now.
The fast-food conglomerate certainly provides investors with its fair share of growth. But notably, Restaurant Brands’s core banners have shown the ability to grow when the economy shifted into slow-growth mode. A trade-down from consumers toward lower-end dining options during previous bear cycles indicates the company’s ability to perform in good times and bad. That’s important for investors looking for consistency.
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This past year, the company reported same-store sales growth of more than 12%, some very impressive numbers. If headwinds materialize, of course, growth can slow. But this is a company I think has the potential to continue to see outsized growth over time, regardless of the macro narrative. That has a lot of value for long-term investors.
Why Restaurant Brands can beat the market
Restaurant Brands’s sheer size, its diversified portfolio of quick-service restaurant banners, and its global exposure make this a growth stock that I think is worth buying for the long term. The company’s solid earnings picture, which has been improving thanks to reinvestment and menu innovation, can continue indefinitely. As the company grows and potentially acquires additional franchises, this business could be poised for solid capital-appreciation generation for investors.
Again, I like the company’s defensive business model and its ability to thrive in any environment. No one knows how the economy will look a few years from now, let alone a few months down the road. For those taking a defensive position and looking for growth, QSR stock is among the first places I’d look right now.
The post This Growth Stock Has Market-Beating Potential appeared first on The Motley Fool Canada .
Fool contributor Chris MacDonald has positions in Restaurant Brands International. The Motley Fool recommends Restaurant Brands International. The Motley Fool has a disclosure policy .
2024