Despite surging COVID-19 cases, the restaurant industry is expected to continue seeing good demand owing to robust consumer spending and continuing government efforts to curb the spread of the highly contagious Delta variant. Thus, we think under-the-radar restaurant stocks Bloomin’ Brands (BLMN), Denny’s (DENN), Nathan’s Famous (NATH), and Potbelly (NASDAQ:PBPB) could be ideal bets now because they are poised to capitalize on current industry growth. So let's take a closer look at these names.Although a spike in COVID-19 cases has raised concerns about the restaurant industry’s prospects, it is highly unlikely that the sector will witness the same scenario it faced last year. That’s because government agencies this time are striving to curb the rapid spread of the new coronavirus strain by recommending booster shots and imposing new-normal restrictions. Furthermore, according to data released by the U.S. Census Bureau, the total sales of eating and drinking places for July stood at $72.2 billion, which is 9.1% above February 2020 (pre-pandemic) sales volume.
Because consumer demand has heightened the industry's need for workers, the restaurant industry added a net 253,200 jobs in July and 1.3 million jobs in total in the past seven months. The industry’s growth will likely continue in the coming months on the back of strong discretionary spending and pent-up demand for socializing and out-of-home experiences.
Therefore, we think under-the-radar restaurant stocks Bloomin’ Brands Inc. (BLMN), Denny’s Corporation (DENN), Nathan’s Famous Inc. (NATH), and Potbelly Corporation (PBPB) could be great investment bets now because they are fundamentally well-positioned to cash in on the industry’s growth.