Slow economic growth and continued high unemployment have limited the recovery in discretionary consumer spending, but steady improvement for the restaurant sector should continue according to Bob Bielinski , Managing Director and Head of the Restaurant Industry Practice at CIT Group Inc, (NYSE: CIT) cit.com, a leading provider of financing to small businesses and middle market companies. This topic is one of many discussed in the U.S. Restaurant Industry Outlook ( cit.com/vodcastbielinski), the latest in a series of in-depth executive video Q&As featured in the award winning CIT Executive Insights video series (cit.com/executiveinsights).
Financing Available for Large Operators
Like consumers, lenders stepped away from the market during the downturn; however, they have returned, along with some new entrants. “Large and middle market restaurant companies, as well as franchisees of larger chains, have accessed the debt markets to finance growth, whether it’s acquisitions, new units or remodels,” says Bielinski. “However, if you’re a smaller company or a franchisee of a smaller chain, you’re probably still finding it difficult to get financing.”
IPO Markets Strong, M&A SteadyEarlier this year the market saw a steady flow of mergers and acquisitions transactions, including deals for Yard House, P.F. Chang’s, O’Charley’s and Benihana. Bielinski comments, “There have also been a significant number of franchisee transactions driven by the sales recovery and by the potential increase in taxes in 2013. It’s a great time to sell a business because valuation multiples are very high and the debt markets are strong, so buyers can get financing. However, the restaurant companies that were sold in 2010 and 2011 have new owners that aren’t ready to sell.”
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV