The Zacks Retail-Restaurants industry faces mounting challenges due to high menu prices and restricted consumer budgets, affecting customer traffic. As of 2026, the U.S. restaurant industry is projected to generate approximately $1.55 trillion in sales, driven primarily by price increases rather than a significant uptick in customer visits. The industry ranks #175 out of over 244 Zacks industries, placing it in the bottom 28%, with a negative earnings outlook impacting overall performance.
Despite these challenges, restaurants are capitalizing on a consumer preference for convenience, with increased investments in delivery services and digital ordering platforms. Companies like Starbucks Corporation (SBUX) are positioning themselves for growth, expecting a 3.2% rise in sales and 8.5% in earnings for fiscal 2026. Yum China Holdings, Inc. (YUMC) foresees a 7.8% sales growth and a 15.9% rise in earnings. Conversely, Dutch Bros Inc. (BROS) anticipates a 24.5% sales growth but has seen its stock decline by 9.8% in the past six months.
Over the last year, the retail-restaurants industry has seen a mere 1.2% gain, significantly lagging behind the S&P 500, which has increased by 37.3%. The industry is currently trading at a forward 12-month P/E ratio of 24.01x, above the S&P 500’s 21.91x, indicating that investors remain cautious about future earnings growth.
