QSR vs. CMG: Which Stock Is the Better Value Option?

Core Viewpoint - Investors in the Retail - Restaurants sector should consider Restaurant Brands (QSR) as a potentially undervalued stock compared to Chipotle Mexican Grill (CMG) [1] Group 1: Zacks Rank and Earnings Outlook - Restaurant Brands has a Zacks Rank of 2 (Buy), indicating a positive earnings estimate revision trend, while Chipotle Mexican Grill has a Zacks Rank of 3 (Hold) [3] - The improving earnings outlook for QSR makes it a more attractive option for value investors [7] Group 2: Valuation Metrics - QSR has a forward P/E ratio of 17.51, significantly lower than CMG's forward P/E of 33.94 [5] - The PEG ratio for QSR is 2.54, while CMG's PEG ratio is higher at 3.86, indicating QSR may be undervalued relative to its expected EPS growth [5] - QSR's P/B ratio stands at 4.44, compared to CMG's P/B ratio of 16.66, further suggesting QSR's relative undervaluation [6] - Based on these valuation metrics, QSR holds a Value grade of B, while CMG has a Value grade of C [6]