4 Restaurant Stocks Up 50%+ in Past 6 Months: Why They're Still Buys

The U.S. restaurant industry has faced a challenging environment over the past six months, with the sector down 10.6% as consumers remain cautious about discretionary spending and operators contend with elevated labor, food and other operating costs. Restaurant traffic has also been uneven, increasing the pressure on companies to offer compelling value while protecting margins. Despite these headwinds, the industry is now ranked relatively favorably. The Zacks Retail – Restaurants industry is ranked 97 out of 248 industries, or in the top 39%.

The relatively favorable industry ranking suggests that opportunities remain despite the recent weakness in restaurant stocks. Operators are focusing on initiatives such as menu innovation, targeted promotions, cost controls and productivity improvements to navigate a more selective consumer. Meanwhile, restaurant sales continue to grow in nominal terms, although inflation-adjusted growth remains modest. The National Restaurant Association's latest outlook projects 4.3% growth in U.S. restaurant and foodservice sales in 2026, while inflation-adjusted sales are expected to rise 0.8%, pointing to a moderate-growth environment for the industry.

Against this backdrop, the performance of a select group of restaurant stocks has been particularly notable. Bloomin' Brands, Inc. BLMN, BJ's Restaurants, Inc. BJRI, Cracker Barrel Old Country Store, Inc. CBRL and Brinker International, Inc. EAT have each gained more than 50% over the past six months, significantly outperforming the broader industry. Their strong rallies highlight how company-specific factors can outweigh broader sector pressures, particularly when investors see improving earnings prospects, better operational execution or opportunities for margin expansion.

Price Performance

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After advancing more than 50% in six months, these stocks have already delivered substantial returns, yet their investment cases remain supported by expectations for further improvement in their underlying businesses. Stronger earnings estimate revisions and operational initiatives could provide additional support for the stocks. Let's examine the key factors that make BLMN, BJRI, CBRL and EAT attractive investments even after their substantial six-month gains.

The Case for These 4 Restaurant Stocks

Bloomin' Brands: It is gaining momentum from the ongoing Outback turnaround, with improvements in food quality, service and affordability helping strengthen the brand. Customers are also showing a greater willingness to trade up to premium steak cuts and higher-priced meal options, driving higher average checks and supporting comparable sales despite softer traffic. At the same time, productivity initiatives and better restaurant-level margins are improving profitability, while the company’s decision to raise its 2026 earnings outlook signals greater confidence in the turnaround.

In the past 60 days, earnings estimates for 2026 and 2027 have increased to 98 cents and 98 cents from 89 cents and 90 cents, respectively. Sales are also expected to witness growth of 0.5% and 1.6% in 2026 and 2027, respectively. The company carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
 

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BJ's Restaurants: It is benefiting from stronger customer traffic, supported by the popularity of its seasonal Pizookies, PMD offerings and the Pizookie Meal Deal, along with ongoing menu innovation and marketing efforts. BJRI is also working to improve guest engagement and restaurant execution through employee training, upgraded point-of-sale systems, enhanced tablets and an AI-enabled labor model. In addition, investments in restaurant remodels and plans to expand its unit base could provide further support to growth.

In the past 60 days, earnings estimates for 2026 and 2027 have witnessed upward revisions of 7.2% and 6.7% to $2.37 and $2.72 per share, respectively. Earnings are projected to increase 4.9% in 2026 and 14.9% in 2027. Sales are also expected to remain on a growth trajectory, with estimates calling for increases of 4.3% and 4.1% in 2026 and 2027, respectively. The company carries a Zacks Rank #2 (Buy).

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Cracker Barrel: It is benefiting from ongoing menu enhancements, operational improvements, value-oriented offerings and tighter cost controls. CBRL is also using its loyalty program, digital initiatives and AI-based tools to deepen customer engagement and improve operating efficiency. Its Cracker Barrel Rewards program continued to gain traction in the third quarter of fiscal 2026, with membership approaching 12 million and rewards members accounting for more than 40% of tracked sales.

In the past 60 days, earnings estimates for 2026 and 2027 have increased to 7 cents and $1.28 from a loss of 83 cents and earnings per share of 67 cents, respectively. Sales are expected to witness a decline of 5.3% and a gain of 4% in 2026 and 2027, respectively. The company carries a Zacks Rank #2.

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Brinker International: It is benefiting from the continued strength of Chili’s, driven by healthy traffic, pricing, everyday value and ongoing menu innovation. Better restaurant execution and labor productivity are helping protect margins even as commodity costs remain elevated. Strong cash generation also gives Brinker flexibility to invest in its business, repurchase shares and reduce debt. EAT’s fiscal 2027 outlook calls for further revenue and earnings growth, with continued traffic gains and restaurant reimages at Chili’s expected to support performance.

In the past 60 days, earnings estimates for fiscal 2027 and 2028 have increased to $13.01 and $13.90 from $12.42 and $13.43, respectively. Earnings are projected to increase 21.1% in fiscal 2027 and grow 6.8% in fiscal 2028. Sales are also expected to remain on a growth trajectory, with estimates calling for increases of 7.5% and 2.8% in fiscal 2027 and 2028, respectively. The company carries a Zacks Rank #2.

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This article originally published on Zacks Investment Research (zacks.com).

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