In this piece, we will discuss the 11 Best Restaurant Stocks to Buy Right Now.
With 2025 proving to be a turbulent year for the restaurant industry, investors will welcome the new year with one key question: which restaurant stocks are best positioned to overcome shifting consumer behavior, cost pressures, and operational changes? David Palmer, Senior Managing Director and Head of the Restaurant and Food Producers team at Evercore ISI, appeared on CNBC’s Squawk on the Street on December 23, 2025. His discussion on the sector is quite relevant to that question.
The discussion began with a look back at 2025, a choppy period marked by early optimism that gave way to weak consumer sentiment and tariff-related costs. While some brands leveraged value deals and discounting for a turnaround, many are still struggling. The discussion identified commodity inflation, particularly beef prices, as one of the key factors shaping the 2026 outlook. More importantly, the net inflationary impact on middle-income consumers remains a key concern, according to David Palmer. In the current environment, he sees relatively higher strength in the casual dining segment, thanks to its stronger resilience than the fast food segment. He believes the segment could potentially benefit from early tax relief. He pointed out that operators focused on value execution are more likely to stand out.
Meanwhile, on December 30, 2025, CNBC touched upon technology’s growing role in the sector amid a hyper-competitive environment. CNBC reported that major restaurant operators, such as Chipotle and Cava, are pouring money into automated makelines from startup Hyphen. These are helping them up their service speed, reduce labor strain, and minimize food waste. These investments reflect an increasing focus on efficiency and consistency within the sector and the key themes shaping the best restaurant stocks today.
Photo by Clem Onojeghuo on Unsplash
Our Methodology
To curate our list of the best restaurant stocks to buy right now, we used financial media and screeners to identify restaurant stocks with significant analyst coverage. Next, we assessed hedge fund sentiment surrounding these stocks using Insider Monkey’s hedge fund database, which tracks over 1,000 hedge funds as of Q3 2025. We ranked these stocks in ascending order by the number of hedge funds that are bullish on them. We also considered the upside potential of each stock as of market open on January 6, 2026.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
11. Papa John’s International, Inc. (NASDAQ:PZZA)
Number of Hedge Fund Holders: 26
Upside Potential: 20.40%
Papa John’s International, Inc. (NASDAQ:PZZA) is one of the best restaurant stocks to buy now.
As of January 6, 2026, roughly 40% of analysts are bullish on Papa John’s International, Inc. (NASDAQ:PZZA) with a median price target of $48.00, amid the company’s strategic and expansion initiatives. The price target translates into an upside potential of 20.40%. The most recent analyst update came from Jefferies on December 15, 2025, where it reiterated its “Hold” rating on the stock with a $45 price target.
Jefferies’ reaffirmation followed Stifel’s update in the previous month. Stifel also reiterated its “Hold” rating on Papa John’s International, Inc. (NASDAQ:PZZA) with a $42 price target. The update came after analysis of the company’s 10-Q filing. The investment firm updated its financial model to incorporate the company’s planned cost-saving initiatives for 2026. The model now also includes management’s plans to refranchise a significant portion of its domestic company-owned restaurants over the next two years. In November, Papa John’s International, Inc. (NASDAQ:PZZA) made a strategic refranchising announcement, refranchising 85 restaurants in the Washington, D.C., and Baltimore markets to Pie Investments, led by Chris Patel. This came after the retirement of longtime franchise partner William Freitas. Within the same announcement, Papa John’s also announced that it plans to open 52 additional restaurants by 2030 across the Greater Philadelphia, Washington, D.C., and Baltimore markets.
For fiscal 2026, the firm projects EBITDA of approximately $205 million, representing approximately 4% year-over-year growth. The firm’s EBITDA forecast is below the Street consensus estimate of $213 million. Additionally, Stifel mentioned that the EBITDA metric could vary if Papa John’s International, Inc. (NASDAQ:PZZA) makes an incremental investment in its marketing fund. The company has already invested $25 million in marketing so far in 2025. The firm’s projections include a $10 million incremental investment in marketing.
Papa John’s International, Inc. (NASDAQ:PZZA), an American pizza restaurant company, operates one of the world’s largest pizza restaurant chains with about 6,000 restaurants in approximately 50 countries and territories.
10. The Wendy’s Company (NASDAQ:WEN)
Number of Hedge Fund Holders: 30
Upside Potential: 11.00%
The Wendy’s Company (NASDAQ:WEN) is included in our list of the best restaurant stocks to buy now.
The Wendy’s Company (NASDAQ:WEN) saw analyst pressure rising at the end of December, with RBC Capital reducing its price target from $9.00 to $8.50 on December 22, 2025, while reiterating a “Sector Perform” rating. The firm’s reduction in its price target reflects cost and margin risks heading into 2026, believing that consensus G&A expense assumptions appear understated. Acknowledging that 2025 G&A declines were due to lower incentive compensation, the investment firm projects that fiscal 2026 G&A could rise to $285-290 million. This projection is well above the Street estimate of $264.6 million.
Furthermore, RBC Capital projects potential downside to restaurant-level margins (RLMs), driven by pressure from U.S. same-store sales growth of 0%-1% alongside heightened beef inflation. The company-owned restaurants contribute roughly 37% of operating profit. Thus, the investment firm believes that a reduction in RLMs to 12.7% from 13.5% could result in a 3.5% EPS headwind. Accordingly, the investment firm lowered its 2026 EPS forecast by 13.0% to $0.68 and its 2027 EPS forecast by 11.8% to $0.79.
The month also witnessed a bearish outlook from analysts. On December 17, 2025, Goldman Sachs reduced its price target on The Wendy’s Company (NASDAQ:WEN) from $9 to $8, reiterating a “Sell” rating. Two weeks earlier, JPMorgan also reduced its price target from $12 to $9 and downgraded the stock to “Neutral.” The firm’s cautious stance reflects weak U.S. system economics, declining average unit volumes, and elevated capital requirements tied to developments, remodels, and technology investments.
The Wendy’s Company (NASDAQ:WEN), a U.S.-based fast-food operator and franchisor with over 7,000 restaurants globally, focuses on burgers, chicken, and quick-service dining.
9. Yum China Holdings, Inc. (NYSE:YUMC)
Number of Hedge Fund Holders: 31
Upside Potential: 22.70%
Yum China Holdings, Inc. (NYSE:YUMC) is one of the best restaurant stocks to buy now.
On December 12, 2025, Yum China Holdings, Inc. (NYSE:YUMC) successfully reinforced its shareholder return narrative by announcing share repurchase agreements in the U.S. and Hong Kong. The agreements totaled approximately $460 million for the first half of 2026, with purchases set to begin on January 12, 2026. About $350 million under a Rule 10b5-1 program in the U.S. and roughly HK$800 million under a similar program in Hong Kong are included in the agreements.
The initiative is part of Yum China Holdings, Inc.’s (NYSE:YUMC) plan to return $1.5 billion to shareholders in 2026 through dividends and buybacks. The repurchases are equivalent to around 9% of market capitalization as of December 11, 2025. Management expects $4.5 billion to be returned to shareholders through this plan from 2024 to 2026. Starting in 2027, the company expects to return approximately 100% of annual free cash flow, with average returns of $900 million to over $1 billion in 2027-2028.
Amid these developments, Yum China Holdings, Inc. (NYSE:YUMC) continues to draw analyst attention, with Daiwa reiterating a “Buy” rating on the stock with a HK$450 price target on December 16, 2025. Prior to this, in November, the company was revisited by CLSA, which reiterated its “Outperform” rating but reduced its price target from $56 to $55. The update followed the company’s investor day and reflected better-than-expected store growth, mid-single-digit top-line expectations, and the potential for dividend increases starting in 2027.
Yum China Holdings, Inc. (NYSE:YUMC), China’s largest restaurant company, operates and franchises over 17,000 locations across 2,500 cities under brands including KFC, Pizza Hut, and Taco Bell.
8. Restaurant Brands International Inc. (NYSE:QSR)
Number of Hedge Fund Holders: 33
Upside Potential: 16.10%
Restaurant Brands International Inc. (NYSE:QSR) is included in our list of the best restaurant stocks to buy now.
As of January 6, 2026, roughly 60% of analysts are bullish on Restaurant Brands International Inc. (NYSE:QSR) with a median price target of $77.50, translating into an upside potential of 16.10%. Meanwhile, the Street-high target points to a potential upside of 39.30%. This reflects the wide dispersion of expectations around the stock’s medium-term performance.
Several analysts have recently reinforced their outlook, with RBC Capital analyst Logan Reich reiterating an “Outperform” rating on December 9, 2025, with an $82.00 price target, up from $77 earlier. In its research note previewing 2026 for Restaurants and Leisure companies, the investment firm continued to label Restaurant Brands International Inc. (NYSE:QSR) as its “top idea” among global franchised fast-food groups.
The analyst’s bullish stance reflects improving momentum at the company’s Burger King (BK) U.S. brand, accelerating development, smarter growth-focused investments, and lower leverage. Management highlighted BK U.S. progress at the end of Q3 2025 as well, reporting strengthening of the brand’s value proposition through menu innovation, better operations, and impactful remodels. As a result of these efforts, management reported strong absolute results and sales outperformance compared to the Burger QSR market. Reduced leverage cited by the analyst was evident in the company’s net leverage ratio of 4.4x at the end of the third quarter. Restaurant Brands International Inc. (NYSE:QSR) reported total liquidity of roughly $2.5 billion, including $1.2 billion in cash.
Restaurant Brands International Inc. (NYSE:QSR), a global quick-service restaurant (QSR) company, operates and franchises brands including Burger King, Tim Hortons, Popeyes, and Firehouse Subs in more than 100 countries.
7. Texas Roadhouse, Inc. (NASDAQ:TXRH)
Number of Hedge Fund Holders: 37
Upside Potential: 9.0%
Texas Roadhouse, Inc. (NASDAQ:TXRH) is one of the best restaurant stocks to buy now.
The latest analyst update on Texas Roadhouse, Inc. (NASDAQ:TXRH) was issued on January 5, 2026, by BMO Capital. TheFly reported that the firm raised its price target on the stock from $155 to $170, while reiterating a “Market Perform” rating. Despite the raised target, the firm’s commentary was bearish regarding the sector. It expects the restaurant sector to continue facing challenges in 2026 amid ongoing consumer spending pressure, margin constraints, store closure risk, and limited scope for multiple expansion. The recently closed year already saw widespread stock declines and double-digit reductions in earnings outlooks, with the firm projecting these headwinds to persist or even intensify into 2026.
Meanwhile, Texas Roadhouse, Inc. (NASDAQ:TXRH) has been facing share price pressure, with its share price declining roughly 6.35% since early August and over 10% in the past six months. However, in its December 17 update, when Wells Fargo upgraded the stock to “Overweight,” the firm argued that the pullback has created an attractive entry point despite short-term cost pressures. Rising beef costs have weighed on 2025 earnings expectations. Still, the firm sees these pressures as cyclical rather than structural and focuses on positives: the company’s strong value proposition, mid-single-digit traffic growth, and ongoing market share gains. Despite soft expectations for the fourth quarter, the firm expects share price improvement in early 2026 due to easier comparisons, consumer stimulus, and a projected peak in beef costs around Q2 2026. In the firm’s bull case scenario, the price target is set at $220, assuming costs ease faster and traffic remains resilient.
Texas Roadhouse, Inc. (NASDAQ:TXRH), a full-service casual-dining restaurant chain, offers assorted seasoned and aged steaks.
6. Wingstop Inc. (NASDAQ:WING)
Number of Hedge Fund Holders: 39
Upside Potential: 24.10%
Wingstop Inc. (NASDAQ:WING) is included in our list of the best restaurant stocks to buy now.
Wingstop Inc. (NASDAQ:WING) kicked off 2026 with renewed bullish conviction, with Stephens naming the stock its 2026 Best Idea on January 2, 2026. Each of the firm’s 23 industry teams identified one stock they see outpacing the performance of their industry, the Russell 2000, and the broader market. This update came following a challenging 2025 for the company.
However, the investment firm believes Wingstop Inc. (NASDAQ:WING) is emerging from short-term pressures with a clear runway to up its brand reach and bolster customer frequency. It expects the company to achieve this through stepped-up marketing, sports partnerships, improved marketplace placement, and technology-driven initiatives. Furthermore, Stephens emphasized the expanding rollout of Wingstop Smart Kitchen, the company’s high digital mix, its large digital user base, and the planned launch of a loyalty program. These factors are expected to drive growth in 2026, Stephens noted.
The firm’s outlook is reinforced by the company’s management commentary during the Q3 2025 earnings call. During the quarter, Wingstop Inc. (NASDAQ:WING) delivered 10% system-wide sales growth, a 19% unit growth, and nearly 19% adjusted EBITDA growth, thanks to the resilience of its asset-light, highly franchised model amid a shifting consumer environment. Meanwhile, CEO Michael Skipworth noted that Smart Kitchen is live in 2,000 restaurants, resulting in a 50% reduction in service speed, achieving consistent 10-minute delivery times. Significant improvements in guest satisfaction were also noted, alongside mid-single-digit same-store sales outperformance in early adopter regions. Skipworth also discussed the upcoming “Wingstop Is Here” marketing campaign and the Club Wingstop loyalty program, currently in pilot and tracking ahead of expectations. The new marketing push and loyalty program are expected to drive average unit volumes toward a $3 million target in 2026.
Wingstop Inc. (NASDAQ:WING), headquartered in Dallas, Texas, is a franchised, chicken-focused restaurant brand.
5. Yum! Brands, Inc. (NYSE:YUM)
Number of Hedge Fund Holders: 41
Upside Potential: 9.10%
Yum! Brands, Inc. (NYSE:YUM) is one of the best restaurant stocks to buy now.
As of January 6, 2026, roughly 41% of analysts are positive on Yum! Brands, Inc. (NYSE:YUM) with a median price target of $164.00. The median price target translates into an upside potential of 9.10%. The cautiously optimistic analyst sentiment surrounds the stock amid expectations that strategic actions under the company’s new leadership may unlock incremental shareholder value despite short-term uneven growth across brands.
Among the most recent analyst activity, Oppenheimer analyst Brian Bittner downgraded the stock to Perform from Outperform this week, according to The Fly. The analyst cited the valuation as fair, given the stock’s strong performance in 2025, leading to the downgrade.
Separately, a key decision by the new leadership was made in November. According to the company’s press release, a formal review of strategic options for Pizza Hut will be initiated. The decision aims to help Pizza Hut, Yum! Brands, Inc. (NYSE:YUM)’s most challenged global brand, to reach its full potential and maximize value for shareholders. Management admitted that parts of the turnaround may be “better executed outside of Yum! Brands.” The seriousness of the review is evident through the appointment of Goldman Sachs and Barclays, two of the biggest investment banks, as financial advisors. Management emphasized that no timeline for the completion of the review has been set.
Following the announcement, the analyst commentary has reflected a more constructive, yet balanced, view. Stifel revisited Yum! Brands, Inc. (NYSE:YUM) on December 9, reiterating its “Hold” rating with a $160.00 price target. The firm believes that the Pizza Hut divestment could ease a key underperformance risk and improve growth visibility. Though this would come at the cost of lower absolute earnings, the firm noted. Meanwhile, Piper Sandler, which holds a “Neutral” stance and a $158 price target, cautions that much of the valuation upside from a potential divestment may already be incorporated in the current valuation.
Yum! Brands, Inc. (NYSE:YUM), a global fast-food leader, operates KFC, Taco Bell, Pizza Hut, and The Habit Burger Grill. The vast franchise network spans more than 155 countries worldwide.
4. Brinker International, Inc. (NYSE:EAT)
Number of Hedge Fund Holders: 51
Upside Potential: 13.70%
Brinker International, Inc. (NYSE:EAT) is included in our list of the best restaurant stocks to buy now.
As of January 6, 2026, roughly 45% of analysts are bullish on Brinker International, Inc. (NYSE:EAT), setting a median price target of $170.00, which translates into a 13.70% upside.
On December 23, 2025, Brinker International, Inc. (NYSE:EAT) was seen drawing Evercore ISI’s attention. The firm’s David Palmer appeared on CNBC’s Squawk on the Street, highlighting EAT as his preferred stock. The senior managing director, who heads Evercore’s Restaurants and Food Producers team, cited the company’s strong execution and effective value positioning. He pointed toward the casual dining segment’s higher resilience compared to the fast-food market amid consumer headwinds. He described the segment’s environment as one that possesses a strong ability to benefit from tax relief while positioning itself as an affordable “treat” for middle-income consumers. Within this environment, the analyst sees Chili’s value-driven offerings resonating particularly well.
A more constructive analyst view was noted elsewhere across Wall Street, according to TheFly. On December 17, 2025, Brinker International, Inc. (NYSE:EAT) was revisited by Wells Fargo, which raised its price target from $160 to $175 and maintained an “Overweight” rating. The firm cited an improving early-2026 setup due to stimulus tailwinds, easier comparisons, depressed sentiment, and an attractive valuation. Amid lingering industry challenges and less visibility into second-half drivers, the bank emphasized selective opportunities such as EAT. Additionally, JPMorgan keeps an “Overweight” rating on the stock with a $160 price target.
Brinker International, Inc. (NYSE:EAT) is focused on owning, developing, and franchising Chili’s Grill and Bar and Maggiano’s Little Italy restaurant brands.
3. Domino’s Pizza, Inc. (NASDAQ:DPZ)
Number of Hedge Fund Holders: 52
Upside Potential: 24.00%
Domino’s Pizza, Inc. (NASDAQ:DPZ) is one of the best restaurant stocks to buy now.
On January 5, 2026, Domino’s Pizza, Inc. (NASDAQ:DPZ) faced a more cautious stance from Wall Street. TD Cowen analyst Andrew Charles downgraded the stock from “Buy” to “Hold” and reduced his price target from $500 to $460. While Charles remains content with the company’s underlying momentum, his downgrade is driven by a strategic shift that has leaned more heavily into value than previously anticipated. He also highlighted the company’s robust same-store sales (comps) growth in the U.S. Q2 2025 comps in the U.S. were up 3.40% and international comps (ex-FX) were up 2.40%. The trend accelerated in Q3 2025 to 5.20% domestically and 1.70% internationally. However, Charles noted that the company’s increasing focus on lower price-point offerings could soften margin and earnings upside compared to earlier expectations. Accordingly, the analyst maintains a balanced risk-reward view.
In contrast, a more constructive longer-term view on Domino’s Pizza, Inc. (NASDAQ:DPZ) was shared by Bernstein in early December, driven by value-led share gains. The firm reiterated a $490.00 price target with a “Market Perform” rating. The firm’s view is based on management’s confidence in continued traction from value initiatives. Bernstein expects a new value program to launch in 2026, accompanied by higher advertising spend to capture incremental demand. Other catalysts cited by the analyst included the full rollout of DoorDash in the third quarter and gains from the ongoing loyalty program. Management also sees these factors significantly supporting U.S. comparable sales into 2026.
Domino’s Pizza, Inc. (NASDAQ:DPZ) owns a global franchise-driven pizza network.
2. Chipotle Mexican Grill, Inc. (NYSE:CMG)
Number of Hedge Fund Holders: 65
Upside Potential: 16.30%
Chipotle Mexican Grill, Inc. (NYSE:CMG) is one of the best restaurant stocks to buy now.
On January 5, 2026, Chipotle Mexican Grill, Inc. (NYSE:CMG) was revisited by Bernstein, with the firm reiterating its “Outperform” rating but reducing its price target from $50 to $40. This comes amid the firm’s cautious near-term view on U.S. restaurant traffic. The firm says it is entering 2026 with a more realistic stance. It expects any recovery in consumer demand to be gradual following multiple confidence shocks in 2025. Last year was marked by macro and tariff uncertainty, DOGE-imposed federal cuts, tighter migration policies affecting the Hispanic population, and the longest U.S. government shutdown on record. The firm does not expect a drastic rebound in discretionary spending. However, it highlighted potential catalysts emerging in spring 2026, including the passage of a new Tax Bill and demand surge driven by the upcoming Soccer World Cup in the U.S. The soccer event with a global audience is expected to help support traffic and sales momentum.
Meanwhile, a more tactical perspective was shared by Mizuho on January 2, 2026. While raising its price from $34 to $36 and reiterating a “Neutral” rating, the firm said Chipotle Mexican Grill, Inc. (NYSE:CMG) is “appropriately” leaning into pricing and promotions to drive transaction growth. Although this strategy lowers risk to Q4 same-store sales growth, it heightens pressure on restaurant-level margins. According to the firm, the stock’s current valuation correctly reflects the company’s latest long-term EBITDA growth outlook of mid-teens.
Chipotle Mexican Grill, Inc. (NYSE:CMG) operates a fast-casual restaurant platform specializing in burritos, burrito bowls, quesadillas, tacos, and salads.
1. McDonald’s Corporation (NYSE:MCD)
Number of Hedge Fund Holders: 83
Upside Potential: 13.40%
McDonald’s Corporation (NYSE:MCD) is included in our list of the best restaurant stocks to buy now.
As of January 6, 2026, roughly 45% of analysts are bullish on McDonald’s Corporation (NYSE:MCD), with a median price target of $340.00, implying 13.40% upside.
One such firm, Bernstein SocGen Group, reiterated its “Market Perform” rating on December 10, while reiterating a $320 price target. The firm believes there is an untapped upside in the company’s a la carte pricing strategy. At the same time, the firm acknowledged McDonald’s aggressive push into value. The firm cited the $5 Meal Deal launched in June 2024, the Buy One Add One offer in January 2025, and Extra Value Meals introduced in September 2025. Still, Bernstein argued that more refined menu pricing could coexist with profitability goals.
Two days earlier, it was reported by CNBC that McDonald’s Corporation (NYSE:MCD) is moving from discretionary discounting to a more structured, standardized, and measurable approach to managing the trade-off between offering low prices to attract customers and preserving profitability. It was reported that the company will start evaluating franchisees globally to assess value-based pricing effectiveness starting January 1, 2026. With this, the company reinforces accountability across a system where franchisees operate about 95% of restaurants worldwide.
McDonald’s Corporation (NYSE:MCD), a global quick-service restaurant leader, has over 38,000 restaurants across the globe.
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