Restaurant Brands International Inc. (QSR)
Consumer Cyclical · NYQ · US
Fundamentals
Valuation and ratings
Restaurant Brands International Inc. trades at USD77.15, which is 55% below the USD119.73 our discounted cash flow model puts on the business. On that measure alone it screens as undervalued, though a DCF is an argument rather than a measurement, and the market is frequently right about why something is cheap.
Our moat model scores it 53 out of 100, which is a moat, but not a deep one. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 24.3 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Restaurant Brands International Inc.
Restaurant Brands International Inc. operates as a quick service restaurant company in Canada, the United States, and internationally. It operates through six segments: Tim Hortons, Burger King, Popeyes Louisiana Kitchen, Firehouse Subs, International, and Restaurant Holdings. The company owns and franchises Tim Hortons, a coffee and baked good restaurant chain that offers beverages, sandwiches, wraps, flatbread pizzas, and others; Burger King, a quick service hamburger restaurant chain that offers flame-grilled hamburgers, chicken, and other sandwiches; Popeyes, a quick service chicken concept that offers a Louisiana style menu, including fried bone-in chicken, chicken sandwiches, chicken tenders, wings, fried shrimp, and regional items; and Firehouse Subs, which offers subs with meats and cheese, as well as chili, soups, soft drinks, and other sides. Restaurant Brands International Inc. was founded in 1954 and is headquartered in Miami, Florida.
QSR passes 2 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Smart money ownership
14 of the funds we track reported a position in their latest SEC 13F filing. Largest first:
- Bill Ackman, Pershing Square Capital Management, L.P.$1.67B · 12.2% of book
- Seth Klarman, BAUPOST GROUP LLC/MA$597.21M · 11.7% of book
- Christopher Davis, DAVIS SELECTED ADVISERS$265.98M · 1.2% of book
- Capital Research Global, Capital Research Global Investors$185.41M · 0.0% of book
- Ken Griffin, CITADEL ADVISORS LLC$153.51M · 0.0% of book
A word of warning on reading these figures: a 13F reports the market value of a holding, so a fund that traded nothing at all still appears to have sold when the price fell. We found 102 companies where the standard reading gives the opposite answer. Only the share count is honest.
Common questions
Is Restaurant Brands International Inc. (QSR) undervalued?
Against our discounted cash flow estimate of USD119.73, QSR at USD77.15 is 55% below fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
Which funds own QSR?
14 of the institutions we track reported a position in QSR in their most recent SEC 13F filing. A 13F is filed up to 45 days after quarter end, so it tells you what a fund held then, not what it holds now.
What is QSR's P/E ratio?
QSR trades at 24.3 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
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Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.