Buffett Brain · Research note
Score updated 22 Oct 2026 · analysis from 18 Aug 2026
QSR· Consumer Discretionary
Restaurant Brands International
Restaurant Brands' 25% operating margin is strong, but high debt and weak ROIC raise concerns about long-term durability.
Buffett fit
Partial fit
Owner
36
Durability
67
Management
65
Price
40
Score updated 22 Oct 2026 · analysis from 18 Aug 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Consumer Discretionary stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
If we owned 100% of Restaurant Brands, we would be concerned about the high net debt/EBITDA ratio of 5.71, which suggests significant risk.
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Over a 10-year horizon, the main risks include changing consumer tastes, increased competition, and economic downturns impacting discretionary spending.
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Management's shows a mixed picture. The share count has slightly increased with a CAGR of 1.88%, while have been modest at a 1.05% yield.
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With an earnings yield of 3.63% and an yield of 5.51%, the current valuation appears stretched, especially given the of 27.6.
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
5- 1 of 25.2% is top-quintile in the sector.
- 2Revenue CAGR of 13.23% over 5 years indicates strong growth.
- 3Consistent profitability over the last 5 years.
- 4/Net income ratio of 1.87 indicates strong cash conversion.
Concerns
5- 1High net debt/EBITDA ratio of 5.71 suggests significant risk.
- 2 of 8.03% is below sector top-quintile and universal Buffett threshold.
- 3EPS CAGR of -3.4% over 5 years indicates declining earnings.
- 4Current ratio of 0.99 indicates potential liquidity concerns.
Price history
$76.41+34.9%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Restaurant Brands International operates through four segments: Tim Hortons, Burger King, Popeyes, and Firehouse Subs. It earns revenue primarily through franchising fees and sales at company-owned locations. The company has approximately 29,000 restaurants in 100 countries. are strong at 25.2%, indicating efficient operations.
How this analysis has moved
The call has held across 4 reviews.
Sep 27, 2026 → Oct 17, 2026
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
Similar companies in Consumer Discretionary
Questions about Restaurant Brands International
- Is Restaurant Brands International undervalued?
- Would Buffett buy Restaurant Brands International?
- How strong is Restaurant Brands International's competitive advantage?
- Is Restaurant Brands International financially healthy?
- Is Restaurant Brands International's dividend safe?
- Is Restaurant Brands International halal?
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