Mohit Oberoi

Tue, Jun 17, 2025, 4:30 PM4 min read

Restaurant Brands International (QSR) has a dividend yield of 3.7% and is trading at a discount to its historical valuations. Despite being one of the largest fast-food chains with a presence in over 120 countries, QSR is an overlooked name. In this article, we’ll examine whether the stock is a buy for dividend investors given its healthy dividend yield.

To begin with, let’s understand QSR’s business. The company was formed in late 2014 when Burger King and Tim Hortons merged. In 2017, it added Popeye’s to its fold, and in 2021, it acquired Firehouse Subs. Apart from these four segments, QSR also has an International segment. It also separately reports the results of Carrols Burger King restaurants and the Popeyes Louisiana Kitchen (PLK) China restaurants under the Restaurant Holdings segment. Earlier this year, the company acquired the remaining equity in Burger King China and has held that business for sale as it seeks a new controlling shareholder.

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Tim Hortons is the company’s biggest segment by revenue, but is also the slowest growing. Popeyes and Firehouse Subs both delivered double-digit organic revenue growth last year, but the growth is coming from a low base. The International segment also achieved nearly 10% revenue growth last year.

While QSR is not exactly a growth name, it is also not a business that’s past its peak, as is often the case with high dividend stocks. Despite the expected weak start to the year, the company is optimistic about delivering organic adjusted operating income growth of “at least 8%” this year.

Last year, Restaurant Brands unveiled its five-year growth outlook that targets annual sales growth of 8%, which includes 3% organic sales growth and 5% net restaurant growth. The company is also targeting an average annual adjusted operating income (AOI) growth of over 8% over the period. Analysts are modelling earnings growth of 10.2% this year and 8.2% in 2026.

Dividends rank quite high in QSR’s capital allocation policy, and the company’s intent is “consistently growing its dividend with earnings," targeting a payout ratio between 40%-60% over the long term. Last year’s payout ratio was higher than the targeted range as the company increased its dividend despite the fall in earnings.