The Tim Hortons parent just made Josh Brown’s best stocks list and is breaking out
(This is The Best Stocks in the Market , brought to you by Josh Brown and Sean Russo of Ritholtz Wealth Management.) Josh — I mentioned Restaurant Brands International (QSR) on the air a couple of weeks ago when we were talking about Casey’s General Store (CASY) as two consumer-oriented stocks that had great set-ups technically and good fundamental stories to back up the charts. Casey’s has worked out great for us so far, starting from around $670 where I introduced it on The Halftime Report to a new record close above $737 on Wednesday (why can’t they all work out this quickly?). If you took the CASY trade, then you’re rolling up your stop to the purchase price and playing with house money. You can lock in the gain too if you want. Anyway, on that appearance I said we would eventually get around to writing up QSR for this column and, well, the day has arrived. Here we go. Restaurant Brands International is a food chain comprised of Popeye’s Chicken, Burger King, Tim Hortons Donuts and Firehouse Subs. I’m sure Clavicular eats at one of these stores every day. Calorie counts aside, this stock has been a port of calm during the recent storm, hanging on to its year-to-date gains and making our list of the Best Stocks in the Market. This is a breakout in progress with the stock taking out overhead resistance at $75 on its way back toward the highs of two years ago in the low $80’s. While everyone’s watching the Brian Niccol-led Starbucks turnaround, this one may end up being the bigger success in 2026. 3G Capital is the controlling shareholder behind Restaurant Brands and for years their edge was simple: run lean, standardize everything, and let the franchise model do the heavy lifting. That playbook started to hit limits when Burger King U.S. lost relevance and franchisee returns slipped. Instead of scrapping management, 3G made a more interesting bet. Keep Joshua Kobza, the internal operator who understands the system cold, and bring in Patrick Doyle above him as Executive Chairman. Kobza runs the business. Doyle’s job is to fix what the system isn’t delivering, better store economics, better execution and ultimately better growth. I should remind you that Patrick Doyle is a quick service LEGEND. The work he did for shareholders at Domino’s Pizza (DPZ) is in the Hall of Fame. Hang this from the rafters: Doyle took over the struggling brand in 2010, fixed the product (admitted it tasted like s***) and leaned aggressively into digital ordering and apps. This got the franchisees making money again. U.S. same-store sales turned positive and stayed there, and the stock went from roughly $8 to more than $250 during his tenure. As you can see above, $10,000 invested when he took the reins became almost half a million by the time he stepped back in June 2018. That’s the blueprint now being pushed into Burger King through “Reclaim the Flame,” with real capital going into remodels, marketing, and franchisee support. In the most recent results, Burger King U.S. same-store sales turned positive and franchisee profitability has begun to improve, early evidence the playbook is starting to take hold. Pershing Square is a foundational holder of this stock. It has long represented a concentrated position for the fund since its inception at the 2012 IPO. I’m guessing Bill Ackman must be pleased with the latest developments here. The thing I like the best about this story is how early it is. Sean’s going to dive in and then I’ll be back with some risk management… Best Stock Spotlight: Restaurant Brands International, Inc. (QSR) Sean — Restaurant Brands International might not be a household name to most people, but I bet their brands are. Ever heard of a Whopper? How about Popeye’s? This company has some great branding, the virality of both Popeye’s and Burger King is legit. They also own a pretty decent sandwich shop called Firehouse Subs, which puts Subway to shame. And last but not least, Tim Hortons, which is a Canadian coffee and donut shop that has swept the Midwest. Between the four brands, QSR operates 33,000 restaurants in 125 markets, with over 95% of locations franchised. These four brands bring a ton of value to customers. Tim Hortons offers a 10 pack of Timbits (donut holes) for $1.49, and on Whopper Wednesdays over at BK you can get a burger for $3.99! Tim Hortons is the cheapest of the coffee chains, while Burger King has outperformed other burger quick-service restaurants in nine of the last 12 quarters. Firehouse is the name seeing growth, with 7.7% net restaurant growth over the last year, and is now growing at 5x the pace vs 2021. Popeye’s is the underperformer of the group, with comparable sales down 3% year over year and it’s undergoing a transition of leadership. QSR is not a slow-growth company. For the upcoming May quarter, they expect 6% revenue growth, 35% EBIT growth, and 10% EPS growth, all year-over-year. The international segment has been a key driver of sales. QSR has six $1 billion markets excluding the U.S. As QSR opens more international locations, it collects a higher royalty rate on those sales than its current blended average — meaning the overall royalty rate it earns across the system inches up by 1 to 2 basis points. Because QSR is nearly 100% franchised, almost every dollar of incremental royalty revenue drops straight to EPS. And with close to $50 billion in system-wide sales, that small annual rate improvement compounds into a meaningful operating income growth each year. Looking forward, QSR has a goal to open 1,800 net new restaurants per year by 2028, with international stores representing the lion’s share of new stores. Of that total, only 300 to 400 units annually are expected to come from the U.S. and Canada, while the remaining 1,400-plus come from outside North America. This reinforces the royalty story and diversifies revenue, making it more durable and consistent at a time when consumers may be trading the $10 coffee for one half the price. Risk management Josh — I’m not going to tell you to pull the goalie on this one, but I do want you to give it the room it needs for the story to play out. So for traders, I want you using the 200-day around $68 on a weekly closing basis as your line in the sand. Ignore the 50-day, it hasn’t been meaningful at all. The stock is now battling through $75, which has been the ceiling for the past year. This is an active attempt to break out. The difference now is the trend underneath. Price is above a rising 50-day and 200-day, and momentum is confirming with RSI around 60 and no divergence. If it resolves higher, there’s not much in the way until the mid to high $80s based on the prior range. If you start seeing weekly closes below $68 or a big RSI divergence, that’s your signal to step aside and reassess. Right now I see strength. Earnings are coming in early May. DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, or its parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. 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