瑞信-美股-餐饮业-美国餐饮业：从电话到餐桌——数字化餐厅-2019.6.25-142页 (2).pdf

US Restaurants Phone To Table:Digitizing Restaurants Initiation of Coverage DISCLOSURE APPENDIX AT THE BACK OF THIS REPORT CONTAINS IMPORTANT DISCLOSURES,ANALYST CERTIFICATIONS,LEGAL ENTITY DISCLOSURE AND THE STATUS OF NON-U.S ANALYSTS.U.S.Disclosure:Credit Suisse does and seeks to do business with companies covered in its research reports.As a result,investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this report.Investors should consider this report as only a single factor in making their investment decision.25 June 2019 Research Analyst Lauren Silberman,CFA,CPA+1 212 325 2720 lauren.silbermancredit- Equity Research US 2 Table of Contents Executive Summary US Restaurants Industry Overview Company Summaries Key Themes Disclosures Delivery Digital M&A Unit Growth 4 16 34 141 112 3 Accompanying Company-Specific Reports Source:Credit Suisse estimates CMG:Guac is Worth the Extra Charge and So Is Growth;Initiate Outperform DNKN:Shares Hot on Luke Warm Outlook;Initiate Underperform DPZ:Time to Get A Piece of This Pie;Initiate Outperform JACK:Waiting for JACK to Come Out of the Box;Initiate Underperform MCD:Hamburglar Positioned to Steal Share;Initiate Outperform PZZA:Not An Easy Layup;Initiate Neutral QSR:Maintains Claim To Throne;Initiate Outperform SBUX:A Gold Star in Restaurants;Initiate Outperform SHAK:Premium Burger Deserves Premium Multiple;Initiate Outperform WEN:Cant Find Catalysts As Fresh As The Beef;Initiate Neutral YUM:Cant Find Ms Upside;Initiate at Neutral 4 Executive Summary 5 Coverage&Ratings 6 Outperform,2 Underperform,3 Neutral Source:Company data,FactSet,Credit Suisse estimates TickerCompanyCS RatingMarket Cap($MM)Current PriceCS Target PriceUpside/Downside NTM EV/EBITDANTM P/ECS ThesisCMGChipotleOutperform$20,302$727$87019.7%25.6x53.0 xHigh convinction in 10%+top-line growth generating margin leverage with attractive flow-through.Earnings growth supports premium multiple.SHAKShake ShackOutperform$2,531$67$7715.4%28.2x113.8xUnique concept with unit growth potential of 20%+.Upside exists from better-than-expected top-line&margins.Traffic&SSS stabilization should improve sentiment.DPZDominos Pizza Outperform$11,606$280$32015.1%20.4x29.0 xHigh convinction in 10%top-line growth supporting global market share gains.Third-party delivery concerns appear overblown.SSS outperformance should improve sentiment&upside to base case.MCDMcDonaldsOutperform$156,155$204$23014.9%18.0 x24.8xWere bullish on MCDs outlook,with traction against sales initiatives supporting upside to SSS and EPS near&long-term.Healthy global SSS,defensive characteristics,ongoing transition to 95%franchise-mix&increased digital focus should provide support for the current valuation premium.QSRRestaurant Brands Intl.Outperform$32,685$70$7814.3%17.5x25.5xConfident in long-term growth with international network of master franchisees.Menu innovation at BK US and innovation/digital enhancements at TH Canada should support SSS acceleration.Valuation is reasonable relative to the peer group.SBUXStarbucksOutperform$100,433$84$9211.5%17.4x29.0 xHigh-single-digit rev growth,modest margin expansion&repurchases support EPS growth of 10%+going forward.Americas&CAP sales leverage,improved performance in China&strategic optionality represent upside.A more focused growth strategy&enhanced capital structure support the premium valuation to history.WENWendysNeutral$4,480$19$205.3%15.0 x30.3xImproved fundamentals and a more consistent FCF profile appear to be reflected in shares.Were cautious on a meaningful acceleration in unit growth given recent challenges&lack of international infrastructure,and risks to long-term targets could weigh on valuation.PZZAPapa JohnsNeutral$1,557$44$453.4%15.7x36.8xBrand is still in recovery mode and implementation of strategic plan is in the works.While we believe there is risk to numbers and elevated valuation,activist involvement,high short interest,potential value unlock&potential M&A keep us Neutral.YUMYum!BrandsNeutral$33,263$110$106-2.3%20.1x28.3xSolid asset-light business with a strong unit growth outlook and diversified portfolio across brands and geographies.But at 21x EV/EBITDA,valuation is rich and we would wait for a better entry point before becoming constructive on shares.DNKNDunkin Brands Underperform$6,617$80$70-10.1%18.3x26.4xWe like the stability of the business model,experienced mgmt team&recent initiatives.But at 18x EV/EBITDA,DNKN is trading at a significant premium to its history&peers,and we see downside risk from lower growth prospects&an elevated multiple.JACKJack in the Box Underperform$2,229$85$75-10.1%12.1x19.1xFlat SSS,elevated closures,geographic concentration,margin pressure&penetrated burger segment represent headwinds to unit growth(flat over last decade).A lackluster sales plan is unlikely to drive a sustainable SSS inflection.Risk to LT targets exist and could weigh on valuation.US Restaurants Coverage6 Initiating Coverage of the Restaurants Sector Value Creation Source:Credit Suisse estimates Leverage the box(increase in-store sales)New product innovation,marketing/advertising,improved operations,effective value messaging,etc.Expand global footprint Grow units domestically and internationally Work with franchisees and licensed partners Improve margins Top-line drives scale and efficiencies Cost savings 7 Initiating Coverage of the Restaurants Sector Evolution of Digital and Delivery Source:Credit Suisse estimates Leverage the box(increase in-store sales)Demand for convenience Unlock incremental sales through digital channels(mobile order&pay,delivery,loyalty incentives);increase throughput Expand global footprint Increase real estate site potential New formats increase addressable market Increase number of access points Improve margins Generate leverage and cost saves Increased capacity/throughput supports margin leverage(not constrained to three meals)Cost savings(i.e.labor)But digital also comes at a cost(i.e.infrastructure,delivery fees)Volume Increases 10-15%Volume Increases 20-30%Delivery 8 Digital Supports Incremental Sales Volumes Adding Convenience Not Seen Since the Drive-Thru Source:Credit Suisse estimates AUV*Traditional QSR Drive-Thru 50-70%Sales Mix Mobile Order Drive-Thru 20%Sales Mix Drive-thru orders tend to generate higher avg tickets relative to in-store orders(multiple people in car)Digital channels support an additional layer of sales and orders generally 1.5-2x higher than an in-store order(group orders;suggestive sell;more time to browse)*Average unit volume 9 Technology Comes At A Cost Corporate Level Source:Company data,Credit Suisse estimates Technology is a perpetual cost restaurants must incur to maintain their digital ecosystems All companies across all restaurant segments are increasing investments in digital and the majority are partnering with third-party aggregators for delivery Select companies are also making big investments in outside firms as they seek to gain a competitive advantage against peers(accelerate digital innovation,access to talent,etc.)February 2018:$200MM in Grubhub July 2018:Acquires license for CardFree December 2018:Acquires QuikOrder for$77MM February 2019:$25MM digital investment,including$15MM for Accenture partnership March 2019:$100MM investment in Venture Fund that invests in food&retail startups March 2019:$300MM to acquire Dynamic Yield startup&$5MM investment in Plexure 10 Technology Comes At A Cost Restaurant Level Source:Company data,Credit Suisse estimates Infrastructure,Equipment and Software Back of house/front of house technology and equipment,maintenance fees,support,etc.(annual&one time fees)Technology/Digital Transaction Fees Franchisees generally pay fees on every digital order Credit Card Processing Fees Digital orders generally transacted with credit/debit cards Mobile offers and loyalty programs Many restaurant companies are offering mobile-specific deals to encourage utilization and loyalty programs,with both discounts at the cost of the restaurants Delivery Fees Incremental costs:1)commission costs for third-party delivery;2)proprietary delivery infrastructure Delivery commission costs average 15-30%of average tickets 11 Delivery is Expensive for Restaurants and Customers Source:Company data,Credit Suisse estimates Incremental delivery costs weigh on margins,though higher average tickets and incrementality support better delivery order profitability Customers pay higher prices for delivery through delivery fees,service fees and inflated menu prices In-StoreAvg CheckDelivery 1.5x Avg CheckDelivery 2x Avg CheckDelivery 1.5x Avg CheckDelivery 2x Avg CheckAverage Ticket$7.00$10.50$14.00$10.50$14.00Food&Paper28.5%29.0%29.0%29.0%29.0%Labor28.0%18.7%14.0%14.0%10.5%Royalty4.0%4.0%4.0%4.0%4.0%Advertising4.0%4.0%4.0%4.0%4.0%Other Operating12.0%8.0%6.0%6.0%4.5%Rent12.0%12.0%12.0%12.0%12.0%Commission0.0%20.0%20.0%20.0%20.0%EBITDA per order11.5%4.3%11.0%11.0%16.0%EBITDA$per order$0.81$0.45$1.54$1.16$2.24Cost of Delivery-Restaurant LevelAssumes IncrementalityNo IncrementalityIn-StoreAvg CheckDelivery 1.5x Avg CheckDelivery 2x Avg CheckDelivery 1.5x Avg CheckDelivery 2x Avg CheckAverage Ticket$7.00$10.50$14.00$10.50$14.00%Menu Price Adjustment20%20%Adjusted Average Ticket$12.60$16.80Delivery Fee$1.99$1.99$1.99$1.99Service Fee15.0%15.0%15.0%15.0%Small Order Fee(if appicable)$2.00$2.00$2.00$2.00Order Cost to Customer$7.00$14.07$18.09$16.48$21.31Cost of Delivery-Customer LevelNo Menu Price Adj.Menu Price Adj.12 Restaurants are trading at 12x NTM EV/EBITDA,nearly 2x above the 10-yr average of 10.3x and at a P/E of 20 x earnings,relatively in-line with the 10-yr average Restaurants trade at premium valuations driven by:higher unit growth opportunities,international exposure,lower inventory risk,lower impact from digital/online shift Within restaurants,companies with heavily franchised business models and strong unit growth prospects trade at higher valuations Restaurant Valuation Source:FactSet,Credit Suisse estimates NTM P/E NTM EV/EBITDA 6.0 x7.0 x8.0 x9.0 x10.0 x11.0 x12.0 x13.0 x14.0 xMay-09May-10May-11May-12May-13May-14May-15May-16May-17May-18May-19NTM EV/EBITDANTM EV/EBITDA10-yr Avg+1 Std Dev-1 Std Dev10.0 x12.0 x14.0 x16.0 x18.0 x20.0 x22.0 x24.0 x26.0 x28.0 x30.0 xMay-09May-10May-11May-12May-13May-14May-15May-16May-17May-18May-19NTM P/ENTM P/E10-yr Avg+1 Std Dev-1 Std DevCMGDPZYUMDNKNMCDQSRSBUXPZZAWENJACK10.0 x12.0 x14.0 x16.0 x18.0 x20.0 x22.0 x24.0 x26.0 x28.0 x0.0%2.0%4.0%6.0%8.0%NTM EV/EBITDA3-yr Unit CAGR(2019-2021)WENPZZADPZYUMDNKNMCDQSRJACK10.0 x12.0 x14.0 x16.0 x18.0 x20.0 x22.0 x85%90%95%100%NTM EV/EBITDA%Franchised13 Credit Suisse Coverage Valuation Source:Company data,FactSet,Consensus Metrix,Credit Suisse estimates EV/EBITDA vs 3-yr Unit CAGR EV/EBITDA vs SSS EV/EBITDA Current vs 3-yr Historical EV/EBITDA vs%Franchised SHAKCMGDPZYUMDNKNMCDQSRSBUXPZZAWENJACK10.0 x12.0 x14.0 x16.0 x18.0 x20.0 x22.0 x24.0 x26.0 x28.0 x30.0 x0.0%2.0%4.0%6.0%8.0%NTM EV/EBITDA3-yr SSS Avg(2019-2021)10.0 x12.0 x14.0 x16.0 x18.0 x20.0 x22.0 x24.0 x26.0 x28.0 x30.0 xSHAKCMGDPZYUMDNKNMCDQSRSBUXPZZAWENJACKNTM EV/EBITDACurrent NTM EV/EBITDA3-yr Avg NTM EV/EBITDA14 Restaurants Coverage Summary Source:Company data,FactSet,Credit Suisse estimates CurrentMktEnt.EV/EBITDAP/ENetShortCSCSPriceCapValue3-yr3-yrDiv.Debt/Int.as%TickerCompanyRatingPT6/21/19($BN)($BN)AvgAvgYieldEBITDAof FloatQuick Service RestaurantsDNKNDunkin BrandsU$70$80$6.6$9.118.3x15.7x26.4x23.3x1.9%5.1x6%DPZDominos PizzaO$320$280$11.8$15.320.4x19.2x29.0 x25.9x0.9%4.8x9%JACKJack in the BoxU$75$85$2.2$3.412.1x11.9x19.1x17.6x1.9%4.3x15%LOCOEl Pollo Loco-$11$0.4$0.57.7x8.6x15.2x16.7x0.0%1.0 x14%MCDMcDonaldsO$230$204$157.6$188.818.0 x14.5x24.8x21.7x2.3%2.8x1%PZZAPapa Johns InternationalN$45$44$1.4$1.717.1x14.7x36.8x37.3x1.8%2.7x30%QSRRestaurant Brands International O$78$70$32.7$42.217.1x17.3x25.5x23.8x2.9%4.0 x4%SBUXStarbucks CorporationO$92$84$104.8$110.117.5x14.1x29.0 x25.1x1.7%0.9x2%WENThe Wendys N$20$19$4.6$6.815.0 x14.0 x30.3x26.4x2.0%5.0 x7%YUMYum!BrandsN$106$110$34.7$44.720.1x16.4x28.3x24.8x1.5%4.7x2%Average16.3x14.6x26.4x24.3x3.5xFast Casual RestaurantsCMGChipotle Mexican GrillO$870$727$20.4$20.125.8x19.5x53.0 x47.7x0.0%-0.4x7%FRGIFiesta Restaurant Group-$13$0.3$0.46.5x8.0 x21.0 x19.0 x0.0%1.1x5%HABTThe Habit Burger Grill-$10$0.2$0.25.9x7.5x83.7x90.9x0.0%-0.8x9%NDLSNoodles&Company-$7$0.3$0.39.1x9.7x43.7x49.5x0.0%1.0 x13%PBPBPotbelly Corporation-$5$0.1$0.14.1x6.9x338.7x36.0 x0.0%-0.6x8%SHAKShake Shack O$77$67$2.5$2.528.4x23.4x113.8x84.2x0.0%-0.7x17%WINGWingstop-$92$2.7$3.047.1x30.9x119.8x72.1x0.4%4.9x13%Average18.1x15.1x110.5x57.1x0.6xCasual Dining RestaurantsBJRIBJs Restaurants -$43$0.9$1.07.3x8.4x18.5x22.1x1.2%0.6x11%BLMNBloomin Brands -$19$1.7$2.76.6x7.1x11.4x13.4x2.2%2.4x5%CAKECheesecake Factory -$44$2.0$2.09.0 x9.3x16.4x17.3x3.0%0.2x24%CBRLCracker Barrel Old Country Store -$168$4.0$4.310.7x10.0 x18.3x16.8x3.1%0.6x16%CHUYChuys Holdings -$23$0.4$0.48.6x9.7x23.9x22.9x0.0%-0.4x12%DFRGDel Friscos Restaurant Group -$7$0.2$0.59.1x7.2x-28.0 x-76.4x0.0%5.7x26%DINDine Brands Global -$95$1.7$3.010.7x10.4x13.0 x12.6x2.9%4.6x10%DRIDarden Restaurants -$121$15.2$15.711.9x10.4x18.9x17.3x3.0%0.4x6%EATBrinker International -$38$1.4$2.77.2x7.9x9.4x10.8x4.0%3.3x32%PLAYDave&Busters Entertainment -$40$1.5$1.97.6x8.5x13.0 x14.9x1.5%1.3x19%RRGBRed Robin Gourmet Burgers -$31$0.4$0.69.7x6.2x25.6x18.9x0.0%1.2x32%RUTHRuths Hospitality Group -$22$0.7$0.79.8x10.1x15.7x17.3x2.3%0.5x4%TXRHTexas Roadhouse -$52$3.8$3.611.7x11.9x22.1x23.5x2.3%-0.6x8%Average9.2x9.0 x13.7x10.1x1.5xNTMNTM15 Credit Suisse Relative Rankings Source:Company data,FactSet,Credit Suisse estimates DigitalDeliveryProduct InnovationValueDomesticInternationalSales LeverageCost SavingsCMGOSHAKODPZOMCDOQSROSBUXOWENNPZZANYUMNDNKNUJACKUSSSStrategic OptionalityCredit Suisse RatingGlobal Whitespace OpportunityMargin Prospects16 US Restaurants Overview 17 US Consumers Spend$1.6 Trillion On Food Annually Source:USDA,Credit Suisse estimates Food Away From Home Food At Home$311BN$869BN$436BN$747BN$314BN$5BN$36BN$203BN$172BN$15BN$124BNFull ServiceRestaurantsLimitedServiceRestaurantsDrinkingPlacesHotels&MotelsOtherFood AwayFrom HomeGroceryWarehouseClubs&MassMerchantsConvenienceStoresOther Stores&FoodserviceFood AtHome18 Source:USDA,Credit Suisse estimates Food Share Shifting Away From Home US Food Expenditures Food At Home vs Food Away From Home US Food Expenditures Composition Consumers spend more money are increasingly eating more meals away from home,with food away from home now representing a greater share of overall food spend Restaurants have gained 6pp of stomach share over the last 20 years,relative to grocery which has lost 11pp of share 0%10%20%30%40%50%60%70%80%194919531957196119651969197319771981198519891993199720012005200920132017%Food ExpendituresFood At HomeFood Away From Home0%10%20%30%40%50%60%70%80%90%199719981999200020012002200320042005200620072008200920102011201220132014201520