11 Best Fast Food Stocks To Invest In Right Now

3. Yum! Brands, Inc. (NYSE:YUM)

Number of Hedge Fund Holders: 36

Yum! Brands, Inc. (NYSE:YUM) is an American multinational fast-food corporation that operates around 58,000 restaurants worldwide under the umbrella of KFC, Pizza Hut, Taco Bell, and Habit Burger & Grill.

The company is experiencing a downturn in same-store sales due to the ongoing conflict in the Middle East, which has resulted in slightly weaker demand amid calls for the boycott of Western products. Sales have been most affected in Middle Eastern countries, Malaysia, and Indonesia, with the impact of the conflict on sales also felt in several other countries. Moreover, cost-conscious consumers also present headwinds to Yum! Brands, Inc. (NYSE:YUM) as people worldwide become more careful about their spending.

Despite these pressures, the fast-food corporation reported robust results for the second quarter, declared on August 6. Worldwide systems grew by 3%, while core operating profit increased by 10%, driven by strong performances by the Taco Bell and KFC brands. Both combined delivered a system sales growth of 5% led by an 8% unit growth.

KFC in international markets (excluding China) that were not impacted by the Middle East crisis, has witnessed mid-single-digit growth in same-store sales. The brand also experienced significant growth in digital sales, which grew 20% during the quarter, with an impressive 40% surge in kiosk sales. The company is also undergoing massive expansion and acquired 216 KFC restaurants in the United Kingdom and Ireland, which has put KFC on track for 10,000 stores globally by the end of 2024.

Taco Bell’s performance has been impressive as well. It registered a 7% increase in system sales in the US, led by Cantana Chicken delivering above expectations. Same-store sales in the country grew 5%, outpacing the broader QSR market. It also benefited immensely from the launch of other innovative menu items like Secret Aardvark fries and Cheez-It.

Yum! Brands, Inc. (NYSE:YUM) is confident of delivering strong growth in 2025 as inflation moderates and margins grow. Wall Street analysts expect an uptick of 9.74%, in median terms, in its share price. Hedge fund sentiment is improving as well, with 36 hedge funds, amongst those tracked by Insider Monkey, having investments in the company at the end of the second quarter of 2024, up from 35 in Q1. It is one of the best fast food stocks to invest in right now.