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Truist selected two restaurant stocks as potential candidates to look at selling Q2 profits based on the most recent card data.
Analyst Jake Bartlett said McDonald’s (NYSE:MCD) was bracing for potentially strong sales and had seen little acceleration to end the quarter. Of note, the Truist Card Data adjusted estimate for McDonald’s Q2 US system sales of $13.9 billion was +3.5% above consensus. Truist now sees same-store sales growth in US Q2 of 10.0% vs. consensus figure +8.9%.
The company believes its same-store sales momentum in McDonald’s (MCD) US is driven by strong marketing, including the success of the Grimace Birthday Meal which launched on June 12 and went viral on social media. Truist has a Buy rating on MCD and a new target price of $335.
Shake Shack (SHAK) was also cited as a potential earnings star, boosted by a strong quarter ending. Truist Card Data’s adjusted estimate for Q2 sales of $269 million is +1.8% above the consensus estimate. Truist sees Q2 same-store sales growth for SHAK of +5.5% vs. +4.7% and the company’s own guidance of low to mid single digits. Truist has a Buy rating at Shake Shack (SHAK) and an increased target price of $90.
McDonald’s (MCD) was down 0.56% on Tuesday at 12:50 pm, while Shake Shack (SHAK) was up 0.88%.