Consumers exhibit restraint in restaurant spending

Those are just some of the CEO’s on CNBC in the past week weighing in on the health of the consumer. American shoppers have been resilient over the past few quarters, but may be showing some signs of cracking. Kate Rogers is here with more. Very much kind of a mixed message we got from from those clips, Kate. Certainly all over the place Mike. So we are seeing a lot more restraint and how consumers spend their time and money, particularly in the restaurant sector. This earnings cycle there has been a big emphasis on value as brands from McDonald’s to Wendy’s and Dave and buster’s all noting that low income consumers are starting to spend less. Starbucks also noted a pullback in its occasional customer with CEO Locksmith telling analysts quote in this environment many customers have been more exacting about where and how they choose to spend their money. But there have been some exceptions in this sector, Chipotle, Wingstop, Dutch Bros all posting. Strong same store sales numbers, Chipotle actually noting it was seeing growth in all income cohorts this quarter that is a rarity in this environment. Another brand seeing sustained momentum is Sweet Green with same store sales growth of 5% this quarter that stocks flying this morning up 40%. I just spoke with CEO Jonathan Neiman who said their dinner business is actually growing with the addition of new proteins like steak to the menu. Take a listen. Our price points are around $15 and while 15 can feel like a premium pricing for lunch at dinner, it’s actually quite value, especially in the inflationary environment we’ve seen. So while I know many people have talked about a consumer that is hurting, we feel that the, you know, our consumers today are still pretty resilient and I think value, value what we’re putting out there for them. And that’s certainly what it’s all about in this environment. Value, perceived value, when it’s worth it to spend your money, where and how. And I think we’re really seeing the haves and the have nots in this environment. Guys, back over to you, Kate. I was just thinking of some of the names that have beaten comps by not that much. I mean, in this case, swing greens beats by a point. But others, like Shake Shack, have been rewarded almost disproportionately to those that are getting punished. Yeah, Carl. And you know what’s so interesting about the stocks that are best performing in this environment? Sweet grin being one of them, Shake Shack another. You just mentioned Kava. They’re the more expensive names for consumers, right. So people are spending a little bit more money there. It seems like investors are really buying into that idea. And those stocks have a bit more sustained momentum than some of the fast food players in this environment.