Recession coming, and it could be ‘worst ever’ for restaurant stocks

The belief that a recession will hit the U.S. in the coming months prompted a Stifel Nicolaus analyst to turn “decidedly bearish” on restaurant stocks Tuesday, because they have led the stock market lower ahead of previous economic downturns.

Analyst Paul Westra downgraded 11 restaurants, including Chipotle Mexican Grill Inc. CMG, -2.48% , Darden Restaurants Inc. DRI, -3.47% , Panera Bread Co. PNRA, -4.79% , Cheesecake Factory Inc. CAKE, -4.24% and BJ’s Restaurants Inc. BJRI, -5.58% to sell ratings, an unusual grade for the sector. Westra said “we confidently believe” that a recent Stifel survey showing restaurant-industry sales decelerating “simultaneously” across all categories “is a harbinger to a U.S.

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