When quick-service restaurant groups get things right, they really get it right. Fast-growing companies in this sector can achieve rapid expansion because of the franchise model and the oldest trick in the book: using other people's money.
There are 40,800 McDonald’s restaurants in the world - that’s a lot of Big Macs! Every quarter, there are more golden arches in the world helping people forget their problems with a strong dose of calories. At group level, McDonald’s is a marketing and product design company, rolling out ideas and learnings to a footprint that is heavily skewed towards franchise stores. With a long-term share price performance that beats the S&P500, it’s a strategy that works... but is it worth a buy at current levels?
Use the podcast player below to listen to our discussion on Yum! Brands and its Q4'22 result, which accompanies the detailed write-up below: (Date of report: 16 February 2023) There’s an exclamation mark in Yum! and with good reason, as this is the world’s largest restaurant company with over 55,000 venues across various brands where you can get your calorie fix. With a footprint in 156 countries and 98% of the restaurants belonging to franchisees, this is fast food at scale. Clearly, a lot has happened in the 25 years since Yum! was spun-off by PepsiCo. At that time, Yum! was [...]
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