Restaurant Brands International (QSR) is expected to extend its "positive momentum" into Q1, led by strength at Burger King and its international segment, while valuation leaves room for further upside, RBC Capital Markets said.
The brokerage said in a Monday note that it expects the company to "beat" quarterly estimates and said risk/reward and investor sentiment remain positive. It cited improving fundamentals and a high-teens discount to mature global quick-service peers.
Burger King is gaining traction as ongoing renovations, menu innovation and targeted marketing drive performance, with only about 58% of US locations modernized by the end of 2025.
RBC said the brand is approaching a "critical mass" of renovated stores that is creating a positive halo effect on performance. International operations remain a standout, with broad-based strength across key European markets such as France, the UK, Spain and Germany.
The firm flagged potential headwinds at Tim Hortons from slowing Canadian population growth, which could limit same-store sales upside in 2026. Popeyes is still undergoing an operational turnaround that may take multiple quarters before returning to positive same-store sales growth.
RBC said it continues to view Restaurant Brands International as a "top idea" in the global franchised fast-food sector, with improving Burger King US trends, accelerating international growth and a shift toward growth-focused capital allocation expected to support the stock.
The firm has an outperform rating on Restaurant Brands and raised its price target to $90 from $83.
Price: 78.71, Change: -0.20, Percent Change: -0.25
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