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Special Report MCD and TXRH: 2 Low-Risk Restaurant Stocks With UpsideWritten by Dan Schmidt. Article Posted: 2/17/2026. 
What You Need to Know - The restaurant industry has become a key indicator for the K-shaped economy.
- Winners and losers are beginning to emerge based on the perceived value they offer to both higher-end and lower-end customers.
- McDonald's and Texas Roadhouse continue to grow comps despite the tough environment thanks to their value-oriented focus that keeps diners coming back.
The restaurant sector has often been at the forefront of the debate on the K-shaped economy. While consumer sentiment continues to diverge from actual consumer behavior (especially in the retail sector), the food service industry quickly exposes those divergent trends. The upper end of the "K" continues to indulge, while more cost-conscious consumers at the bottom search for value to maximize their dollars. In such an environment, two restaurants are starting to stand out, albeit for different reasons. The numbers speak for themselves: McDonald’s Corp. (NYSE: MCD) and Texas Roadhouse Inc. (NASDAQ: TXRH) are growing comparable sales and taking market share from competitors. Below, we look at why these two have thrived in a challenging dining market and explain why their stocks could outperform the restaurant industry this year. McDonald's Continues to Dominate the Fast Food Market Recently, President Trump decided to kill the coin, for good reason. It now costs 4 cents to make a single penny. Which means the government is losing 3 cents on every one it mints.
But the truth behind Trump's decision may be stranger than you think. What's really happening and what it could mean for your money The recent earnings reports from McDonald’s and Wendy’s Co. (NASDAQ: WEN) highlighted how fast-food players are differentiating themselves. McDonald’s reported Q4 2025 results last week and beat both EPS and revenue expectations, posting 9.7% year-over-year (YOY) sales growth. Global same-store sales topped forecasts with 5.7% YOY growth, including 6.8% growth in the United States. By contrast, Wendy’s Q4 2025 report showed revenue down 5.5% YOY and U.S. same-store sales falling 11.3%. How has McDonald’s been able to grow U.S. sales at nearly a 7% clip while other Quick Service Restaurants (QSRs) struggle? The answer is value. McDonald’s projects operating margins above 40% in 2026, which gives it the flexibility to pursue a Value Leadership strategy. Unlike the limited-time value promotions at some rivals, McDonald’s Value Menu 2.0 is a permanent fixture. Extra Value Meals were reintroduced last September, and earlier this year the company launched the McValue platform, featuring $5 Meal Deals and Buy One, Get One for $1 offers. The Grinch Meal holiday promotion delivered the biggest single-day sales figure in the company’s history. McDonald’s app, with roughly 200 million active users, drives repeat business, and the marketing emphasis on chicken items like the McCrispy helps mitigate beef price inflation. The company also plans to open about 2,600 additional stores this year, while competitors such as Wendy’s are closing underperforming locations. 
The breakout in MCD shares began before last week’s earnings. A bullish crossover in the Moving Average Convergence Divergence (MACD) indicator coincided with the stock rising above the 50-day and 200-day simple moving averages (SMAs), signaling strong upward momentum. If lower-income consumers continue to trade down for value, McDonald’s is well-positioned to keep growing sales, with both fundamental and technical catalysts in 2026. Texas Roadhouse Grows Market Share Despite Commodity Headwinds Soaring beef prices have loomed over Texas Roadhouse shares for much of the past year. Beef prices have risen faster than inflation since the COVID-19 pandemic, and the surge over the last two years has unnerved restaurant owners and investors alike. The rise is driven in part by cattle shortages, which have pushed live cow and steer prices to record levels — a dynamic likely to persist into 2027. Despite this headwind, Texas Roadhouse continues to see same-store sales grow faster than many of its casual-dining rivals. Texas Roadhouse’s barbell business strategy delivers value for cost-conscious customers while also offering premium steaks and upcharge options for diners willing to splurge. In its Q3 2025 report, the company posted comps of 6.1% and nearly 13% YOY revenue growth despite a 224-basis-point increase in food and beverage costs. Management raised prices by just 1.7% — a deliberate margin concession to preserve value for guests. The customer experience is central to Texas Roadhouse’s appeal. For casual-dining chains that rely on repeat visits, traffic durability matters. Large portions, attentive servers, efficient digital kitchens, and a menu of add-ons and upgrades create the atmosphere of a special night out without an excessive bill. Guests consistently report that Texas Roadhouse is "worth it" for date nights and family dinners because the experience matches the perceived value. 
TXRH’s performance so far in 2026 suggests the doldrums of 2025 may be behind it. The stock climbed for 11 straight trading days to start the year, breaking above the 200-day SMA that had capped prior breakout attempts. That run was followed by consolidation, during which the Relative Strength Index (RSI) cooled to more neutral levels while the 50-day and 200-day SMAs converged. With a Golden Cross appearing imminent, the 50-day SMA could become a support level for a fresh rally. That level has already been tested and held, and the share price is now approaching the 50-day moving average — potentially an attractive entry for new investors. A catalyst is due this week when the company reports its Q4 2025 results after the market closes on Feb. 19.
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