Looking for the best fast food stocks for your portfolio? Here are some tips on how to find them

Buying the best fast food stocks can add steady growth to your stock holdings. Find out what to look for in these stocks and discover one of our recommendations.

Are you interested in the best fast food stocks to buy? Some of the best fast food stocks are also blue chip stocks, which are well-established companies with attractive business prospects.

Blue chip companies can give investors an additional measure of safety in volatile markets. And the best ones offer an attractive combination of moderate p/e’s (the ratio of a stock’s price to its per-share earnings), steady or rising dividend yields (annual dividend divided by the share price) and promising growth prospects.

True Blue Chips pay off

Learn everything you need to know in 'The Best Blue Chips for Canadian Investors' for FREE from The Successful Investor.

Canadian Blue Chip Stocks: Bank of Nova Scotia Stock, CP Rail Stock, CAE Inc. Stock and more.

Chipotle Mexican Grill Inc., symbol CMG on New York, is a buy among the best fast food stocks

Chipotle lets you tap this Mexican restaurant chain, headquartered in Denver. The company is a fast-food leader charging slightly higher prices than its competitors but offering better quality food, including naturally raised meat.

Chipotle recently announced the creation of a new venture fund, Cultivate Next, which will provide early-stage investments to companies that align with Chipotle’s mission. The initial size of the fund is $50 million and will be solely financed by the chain.

The fund will support early-stage companies that can help accelerate Chipotle’s strategic priorities, which include improving operations, amplifying technology, advancing its Food With Integrity mission and increasing convenience for consumers.

Chipotle’s venture fund has now made its first two investments.

The first is Hyphen, a foodservice platform focused on automating kitchen operations. The company automates meal production and augments labour, which increases profitability and efficiency in food service. Hyphen can produce over 350 meals an hour while eliminating order defects such as missing ingredients and cross-contamination.

Chipotle aims to find ways to ease obstacles for its employees, especially as it plans to grow to 7,000 restaurants in North America. Hyphen’s makeline technology, which can be used in manual or automation mode, can be used to fulfill orders from digital channels—supporting Chipotle’s online sales growth.

The second, Meati Foods, sells faux meat made with mushroom root, a fungi also known as mycelium. The Boulder, Colorado-based company grows its mushroom root indoors using what it believes are clean and sustainable practices. It currently offers chicken and steak substitutes, which are available at restaurants and grocery stores in Colorado and Arizona.

Meanwhile, Chipotle has been adding more plant-based options to its menu recently. It launched Cilantro-Lime Cauliflower Rice in 2021 and is currently testing Mexican Cauliflower Rice in 60 locations. It has offered tofu based Sofritas since 2014.

Notably, Chipotle has also been exploring various other technologies of late, including partnering with Miso Robotics in March to test Chippy, a robot that can cook tortilla chips, and piloting a radio-frequency identification (RFID) system to trace and track ingredients. The chain also uses a scheduling tool that leverages artificial intelligence to create more effective schedules. In addition, last year, it invested in autonomous delivery company Nuro.

Meantime, with the continued push forward on its digital strategies, as well as making moves to attract and retain workers, Chipotle has thrived despite the coronavirus pandemic. Moreover, it should emerge even stronger as the virus is brought under control. That bodes well for the company’s share price and its investors.

Chipotle Mexican Grill is a buy.

Invest in blue chip stocks, like the best fast food stocks, and you will have some of the top conservative investments working to make your portfolio profitable

At TSI Network we feel that stocks that have been paying dividends for over 10 years are some of the safest investments you can make. Dividends are a sign of quality and a company’s financial health. Types of stocks that we consider to be safer investments include Canadian banks and utilities.

There are also a host of other key indicators to determine if a stock is a safer investment, like management integrity, its growth prospects and its stock price in relation to its sales, earnings, cash flow and so on.

For a true measure of stability, follow our Successful Investor approach and focus on those companies that have maintained or raised their dividends during economic or stock-market downturns.

All in all, we think investors will profit most—and with the least risk—by buying shares of well-established, dividend-paying blue chip stocks with strong growth prospects.

Use our three-part Successful Investor approach for all of your investments, including the best fast food stocks

  1. Hold mostly high-quality, dividend-paying stocks.
  2. Spread your money out across most if not all of the five main economic sectors: Manufacturing & Industry, Resources & Commodities, Consumer, Finance and Utilities.
  3. Downplay or stay out of stocks in the broker/media limelight.

Do you think an increased interest behind healthy eating will negatively impact top fast food stocks?

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