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McDonald’s Corporation (MCD), Yum! Brands, Inc. (YUM): Will This Industry Continue To Grow?

Yum! Brands, Inc. (NYSE:YUM) will be expanding in the United States with its Taco Bell stores. The company has a plan of additional stores, new products, and aggressive marketing to double the division’s revenue in the next eight years – music to investors’ ears.

A small company with fast growth

Chuy’s Holdings Inc (NASDAQ:CHUY) is a small, regional Mexican restaurant chain headquartered in Austin, Texas. The company has just 42 stores and a market cap of only $650 million. So it doesn’t operate in the same world as McDonald’s Corporation (NYSE:MCD) and Yum! Brands, Inc. (NYSE:YUM).

The company had its IPO last July and the stock price has risen nearly 170% since. The main factor leading to this awesome stock growth is top-line revenue growth. Chuy’s Holdings Inc (NASDAQ:CHUY) has shown 25% revenue growth in the last year.

Same-store sales aren’t very impressive but are still solid at 2.3%. The company has been expanding and will continue to do so. The general consensus on revenue growth for the current year is 18%. The growth may start to taper, but there is still growth in the future.

The stock has already climbed quite a bit. But there is more room for this stock.

Final thoughts

The restaurant industry can be a turbulent one. If you are looking for a small company with a lot of room to advance, Chuy’s is the one for you. Both McDonald’s and Yum! Brands are strong names with a long history of performance. If you own these, keep them, as growth should continue throughout the year. If you want major growth, stick with Chuy’s.

The article Will This Industry Continue To Grow? originally appeared on and is written by Austin Higgins.

Austin Higgins has no position in any stocks mentioned. The Motley Fool recommends McDonald’s. The Motley Fool owns shares of McDonald’s. Austin is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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