The 3 Best Restaurant Stocks to Buy in May 2024


  • These restaurant stocks are some of the most well-known names in the industry and will thrive as consumer spending improves. 
  • McDonald’s (MCD): The slowdown in sales has led to a dip in stock, giving an opportunity to investors to dive in. 
  • Domino’s Pizza (DPZ): Domino’s Pizza is steadily moving upwards and reported strong sales growth despite high inflation. 
  • Chipotle Mexican Grill (CMG): Chipotle enjoys unparalleled success in the restaurant industry. 
best restaurant stocks - The 3 Best Restaurant Stocks to Buy in May 2024

Source: Shutterstock

The recent Fed meeting has boosted consumer confidence in an expected rate cut later in the year. Given the high volatility in the stock market over the past few weeks, investors are looking for sectors other than technology. An improvement in the economy is directly related to consumer spending and some of the best restaurant stocks will be the first ones to benefit. 

Having shown resilience throughout the high inflation periods, restaurant stocks have been standing strong. Consumer spending at restaurants increased in 2023 as compared to the prior year and I believe this improvement will continue throughout 2024. I have chosen the best restaurant stocks to buy and hold for long-term gains. These are exceptional companies with a global presence and have already impressed investors with solid fundamentals. 

Take a bite of these delicious restaurant stocks this month. 

McDonald’s (MCD)

New McDonalds Being Built in 2020, Close Up of Main McD Sign
Source: Retail Photographer /

While the first-quarter results didn’t do much good to McDonald’s (NYSE:MCD) stock, there is a reason to bet your money on it. The fast food giant has become one of the best-known global names and it is reporting steady growth. Its revenue increased 5% in the quarter to $6.2 billion and the adjusted EPS increased 2% to $2.70. The global comparable sales increased by 1.9%. 

The company has been making changes in its offerings and this has led to success since the beginning of the year. It has improved the quality and taste and also enhanced delivery services. Since the management saw a drop in traffic to its restaurants, it will have to remain vigilant about the prices. An improvement in consumer spending, however, could help the business see higher revenue growth. 

If you look at the bigger picture, McDonald’s doesn’t have much to worry about. Its franchise income is steadily growing and the company is aiming to test a larger burger this year. With strong fundamentals and a global presence, MCD will continue to stand tall in the competitive industry.

Trading at $269 today, the stock is down 9% year-to-date. It enjoys a dividend yield of 2.48% and is an ideal stock for passive income investors. If you found MCD expensive earlier, now is your time to pounce on this restaurant stock. The stock has also suffered due to the Israel-Hamas conflict and the boycotts in the region. However, the pullback in the stock is a chance to make your move. 

Domino’s Pizza (DPZ)

A tall Domino's Pizza (DPZ) sign stands in Eau Claire, Wisconsin.
Source: Ken Wolter /

A clear winner of the earnings season, Domino’s Pizza (NYSE:DPZ)  had an excellent quarter despite the inflation concerns. The first-quarter results beat analyst estimates as the company reported a revenue of $1.08 billion. Its EPS stood at $3.58 and the sales increased 6% YoY.  Its quarterly net income grew 20% YoY to $126 million. The same-store sales grew 5.6% in the U.S. and this growth was driven by delivery orders. 

The strong results led the stock up 6% and it is now trading for $522, up 16% YTD and 69% in the past 12 months. It has been slowly but steadily moving upwards and has gone from $308 to $522 today. I’d recommended buying the stock in September and if you had bought it then, you would be sitting on gains of 32%. 

Its pricing techniques and menu offerings make it possible for the company to achieve positive same-store sales growth and see higher revenue numbers. The company saw a strong improvement in sales at over 20,000 outlets globally and aims to open 1,100 stores by 2028. An increase in stores will lead to an improvement in sales and revenue in the coming years.

Its marketing efforts with the improved loyalty program are paying off in addition to the quick service time that helped increase orders. Yes, the stock isn’t cheap and is trading at a premium today but if you wait for it to dip, you could be waiting forever. DPZ stock has a dividend yield of 1.16%.

Chipotle Mexican Grill (CMG)

Chipotle - Sign on building, CMG stock
Source: Retail Photographer /

My all-time favorite restaurant stock to own, Chipotle Mexican Grill (NYSE:CMG), will not disappoint you. Trading at $3,199 today, the stock is up 42% YTD and 57% in the past 12 months. The company’s first-quarter results were mind-blowing, and it has announced a stock split of 50-for-1 which has made it even more attractive. 

The stock will split on June 25 and the shares will start trading on June 26. This was an attempt to make the stock appealing to investors, and with the stock trading over $3,000, this was a necessary move. This is another stock I had recommended buying in October when it was trading for $1,837. You could be sitting on 74% gains today. 

The company saw a 14% increase in sales to $2.7 billion, and comparable sales rose 7%. The company is making an entry in Kuwait in a partnership with Alshaya Group to launch its first shop. A timely move, the Middle East brings massive expansion opportunities for Chipotle. 

The company has put up monster returns in the past and it can do so again. It has impressed the market and the stock split could be a good chance for you to add the stock to your portfolio. The stock will trade at a lower value after the split. 

While it will make no difference to the shareholder value, it will become more affordable. It is trading close to $3,000 today and after the split, it could be trading near $60. I love the stock and think that the split is a good opportunity to add it to your portfolio. 

On the date of publication, Vandita Jadeja did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Vandita Jadeja is a CPA and a freelance financial copywriter who loves to read and write about stocks. She believes in buying and holding for long term gains. Her knowledge of words and numbers helps her write clear stock analysis.

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