3 Restaurant Stocks to Avoid As Americans Begin to Cut Spending

1. Brinker International, Inc. (NYSE:EAT)

Number of Hedge Fund Holders: 27

Brinker International, Inc. (NYSE:EAT) is a Texas-based company that owns, develops, and franchises restaurants under the Chili’s Grill & Bar and Maggiano’s Little Italy names. On July 18, Goldman Sachs analyst Jared Garber downgraded Brinker International, Inc. (NYSE:EAT) to Neutral from Buy, slashing the price target to $28 from $46. The analyst sees higher downward risk for same-store sales trends at both Chili’s and Maggiano’s as the macro environment worsens. Additionally, incremental gains from Brinker International, Inc. (NYSE:EAT)’s digital brands, It’s Just Wings and Maggiano’s Italian Classics, may be difficult to materialize in a “more cost-sensitive environment for consumers,” the analyst told investors. He expects the stock to be volatile as estimates reset.

Among the hedge funds tracked by Insider Monkey, 27 funds were long Brinker International, Inc. (NYSE:EAT) at the end of Q1 2022, down from 35 funds in the preceding quarter. Brett Barakett’s Tremblant Capital is the leading stakeholder of the company, with 1.23 million shares valued at roughly $47 million.

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