For value investors, or those looking to take a contrarian view of financial markets, a significant amount of money can be made by finding situations in which companies have either been unfairly beaten up by the market, or are significantly overvalued at any point in time.
While momentum trading has done fantastically well in recent years when compared to a more traditional value-based style of investing, I would certainly find myself in the first camp, and as such would suggest other investors of a similar mindset looking for relative value and unnecessarily pessimistic sentiment to look at Restaurant Brands International Inc. (TSX:QSR)(NYSE:QSR).
Many Canadian investors will have already heard of Restaurant Brands, and will most often associate this company with Tim Horton’s – one of three of the company’s primary holdings.
With a boycott underway for many Tim Horton’s locations across the country, many investors who are taking a look at what consumers are saying (and how they are reflecting this at the till) may be concerned with the company’s recent earnings reports, which highlighted expected same store declines for Tim Horton’s (with some regions being harder hit than others).
That being said, taking a higher level view, one will notice that overall, Restaurant Brands’ portfolio of companies have actually performed very well, led by the company’s Burger King and Popeye’s Louisiana Kitchen banners.
While the company appears to be losing the battle in the trenches, I believe investors who have the guts to stick this one out will do very well by buying at these levels and simply waiting for the next scandal in Canadian business to dominate headlines for months.
Invest wisely, my friends.
