QSR.TO
Restaurant Brands International Inc.
Consumer Cyclical · Restaurants · Canada · Stock
Score Breakdown
Scored for Dividend Income profile
Sub-scores are 0–20 each; Model Score is weighted by your selected investment goal. How it works →
Why Ranked Here
- The composite score of 48.5/100 reflects a profitability sub-score of 13.2/20 that anchors the rating, supported by a franchise model that structurally generates higher margins than company-owned peers in the restaurant sector.
- The dividend sub-score of 10.0/20 and momentum sub-score of 11.4/20 provide meaningful mid-range contributions, preventing a lower overall score by confirming free cash flow coverage and recent operational improvement.
- The growth sub-score of 8.5/20 and theme score of 0.0/20 together constrain the total, as weak top-line and earnings growth momentum alongside zero thematic alignment leave the overall model score below the midpoint.
Why Not Higher
- The growth sub-score of 8.5/20 is the primary ceiling constraint, as the FY2025 10-K data did not reflect sufficient year-over-year revenue, net income, or EPS growth to justify a higher contribution from what is typically a heavily weighted metric.
- The theme sub-score of 0.0/20 represents a full 20-point gap versus a theoretically top-scoring company, and its complete absence means QSR.TO receives no uplift from macro trend alignment that might otherwise support a higher composite score.
Data Confidence
9 / 10
Very High — full data coverage
Research Summary
AI-generated analysis reflects data and conditions as of the report date shown above. Verify any specific figures through primary sources before acting on this analysis.
Restaurant Brands International Inc. (QSR.TO) is a Canadian-headquartered multinational quick-service restaurant company that owns and operates some of the world's most recognized fast-food brands, including Tim Hortons, Burger King, Popeyes Louisiana Kitchen, and Firehouse Subs. The company operates primarily through a franchise model, generating revenue from royalties, franchise fees, and property income across thousands of locations globally. Its business model is inherently asset-light relative to company-owned operators, though it carries substantial debt from its leveraged structure and past acquisitions. The model assigned QSR.TO a score of 48.5/100, reflecting a mixed picture across its sub-scores. The profitability sub-score of 13.2/20 is the strongest individual contributor, consistent with the margin advantages of a franchise-heavy operating model. The dividend sub-score of 10.0/20 and momentum sub-score of 11.4/20 provide additional support, suggesting the company generates sufficient free cash flow to sustain distributions and has shown some quarterly operational improvement. However, the financial health sub-score of 10.0/20 points to meaningful leverage concerns, and the growth sub-score of 8.5/20 suggests revenue and earnings expansion has been underwhelming in the filing period. The theme sub-score of 0.0/20 — reflecting no identified macro theme exposure — is a notable drag, limiting total score potential. The central research tradeoff for QSR.TO is between a relatively resilient franchise-based profitability profile and the constraints imposed by high leverage, modest growth, and an absence of thematic tailwinds. For researchers focused on dividend income, the best-fit profile score of 51.1 is marginally more constructive, but the High risk rating and a composite score that sits below the midpoint of 100 suggest this remains a candidate requiring deeper due diligence before drawing conclusions.
Plain English
Restaurant Brands International owns Tim Hortons, Burger King, Popeyes, and Firehouse Subs — big fast-food brands that mostly operate as franchises around the world. The model score of 48.5 out of 100 means the company has some things going for it, like decent profit margins and dividend-supporting cash flow, but it also carries a lot of debt and hasn't been growing strongly, which pulls the score down. The High risk rating reflects that heavy debt load and limited growth, meaning things could get harder if business conditions worsen. Researchers treating this as a dividend income candidate will find it slightly more compelling on that specific lens, but it still warrants careful further analysis.
Bull Case vs. Bear Case
Bull Case
- The profitability sub-score of 13.2/20 reflects the structural margin advantages of QSR's franchise-heavy model, where royalty and fee income carries higher margins than company-owned restaurant operations.
- The dividend sub-score of 10.0/20 indicates that free cash flow coverage of distributions is present in the filing data, making QSR.TO the strongest fit under the dividend income goal profile with a profile-specific score of 51.1.
- The momentum sub-score of 11.4/20 suggests that on a quarterly basis, revenue, earnings, or margins showed measurable improvement during the FY2025 filing period, indicating some operational progress across the brand portfolio.
Bear Case
- The financial health sub-score of 10.0/20 reflects a leveraged balance sheet consistent with QSR's history of debt-funded acquisitions, which limits financial flexibility and elevates vulnerability to rising interest costs.
- The growth sub-score of 8.5/20 is the weakest filing-derived metric, signaling that year-over-year revenue, net income, and EPS growth were insufficient to generate a strong score, raising questions about near-term expansion capacity.
- The theme sub-score of 0.0/20 means the model identified no meaningful macro theme alignment — such as digital transformation, emerging markets consumer growth, or sustainability — reducing the forward-looking appeal of the research candidate.
What Could Change the Picture
Bullish Triggers
- A meaningful improvement in the growth sub-score in a subsequent filing period — driven by accelerating same-store sales, net new restaurant unit growth, or EPS expansion across the Tim Hortons, Burger King, or Popeyes brand segments — would materially strengthen the research case.
- Demonstrated reduction in leverage ratios as reflected in an improved financial health sub-score, potentially through debt repayment or EBITDA growth outpacing debt obligations, would reduce the risk profile and increase the financial health contribution to the model.
Bearish Triggers
- A deterioration in the dividend sub-score — signaled by declining free cash flow coverage of distributions or a reduction in dividend per share growth — would weaken the primary basis for QSR.TO's dividend income goal profile fit of 51.1.
- Further compression in the profitability sub-score, driven by margin pressure across the franchise system from franchisee cost inflation, declining traffic, or increased company-owned restaurant exposure, would undermine the strongest current pillar of the model score.
Red Flags
- The financial health sub-score of 10.0/20 combined with the growth sub-score of 8.5/20 together suggest a company carrying substantial leverage without the revenue acceleration typically needed to comfortably service and reduce that debt load.
- A theme score of 0.0/20 out of a possible 20 points represents a complete absence of identifiable macro tailwinds in the filing data, which limits the upside case for score improvement under current model conditions.
Risk Profile
High RiskThe High risk rating for QSR.TO reflects the combination of meaningful balance sheet leverage identified in the financial health sub-score of 10.0/20 and sluggish growth metrics, which together create vulnerability to earnings deterioration, refinancing challenges, or dividend sustainability pressure under adverse operating conditions. For a company whose investment thesis relies substantially on franchise royalty income stability and free cash flow generation, any structural weakening of franchisee health or consumer spending in key markets could amplify downside risk disproportionately.
Key Catalysts to Watch
Key factors to monitor include the trajectory of net new restaurant unit additions across all four brand segments and whether same-store sales trends improve sufficiently to lift the growth sub-score in subsequent filing periods. Progress on balance sheet deleveraging and the sustainability of free cash flow relative to dividend distributions will be critical determinants of whether the model score improves or deteriorates from the current 48.5/100 level.
This report is for educational and research purposes only. It does not constitute financial, investment, legal, or tax advice — always conduct your own due diligence before making investment decisions.