These Stocks Drive This Year's 20% Restaurant Industry Surge

• Top performers include Kura Sushi (up over 40%), Biglari Holdings (up ~35%), Cracker Barrel (up 30%), and Dave & Buster's (up 28%)
• Nathan's Famous surged nearly 9% after Smithfield Foods agreed to acquire it for $102 per share
• Brinker International rose 3% following a Raymond James upgrade to outperform with a $195 price target (implying 20% upside), with at least four analysts issuing buy ratings this year

Restaurant Industry Stocks Surge 20% in Early 2026

Key Performance

The restaurant industry has posted a strong start to 2026, with the 27-stock sector group rising nearly 20% year-to-date, making it the sixth-fastest moving industry group overall. This performance places restaurants alongside AI-related sectors like semiconductors and data storage, as well as precious metals stocks.

Top Performers

Leading stocks include:

• Kura Sushi (Japan-based): Up over 40%
• Biglari Holdings (Steak 'n Shake): Up approximately 35%
• Cracker Barrel: Up 30%
• Dave & Buster's: Up 28%
• Bloomin' Brands (Outback Steakhouse): Up 20%
• Shake Shack: Up 20%
• Texas Roadhouse and Cava: Both up 17%

Major Transactions

Smithfield Foods agreed to acquire Nathan's Famous (hot dog maker and restaurant chain owner) for $102 per share, driving Nathan's stock up nearly 9%.

Analyst Activity

Brinker International (Chili's parent) gained 3% after Raymond James upgraded it to outperform with a $195 price target, implying 20% upside. At least four other analysts issued buy ratings in 2026, with the highest target at $210 from Evercore ISI.

Market Drivers

The sector rebound follows a difficult 2025, supported by:

• Strong consumer spending despite previous economic uncertainty
• Falling interest rates increasing disposable income
• Easy year-over-year sales comparisons

Several midtier chains are reversing significant 2025 losses, with Bloomin' Brands and Shake Shack recovering from 50% and 37% declines respectively.