U.S. casual dining has held up better than many investors expected in 2026, according to Evercore ISI, but the firm also sees a recent loss of momentum among households earning more than $100,000. That contrast matters because restaurant stocks can look defensive when traffic is stable, yet their profits remain sensitive to even modest changes in customer visits and promotional spending.
The sector entered the slowdown from a position of strength
Recent company reports give the resilience argument some support. Brinker International said comparable restaurant sales rose 5.0% in its fiscal fourth quarter, including 5.6% growth at Chili's. Texas Roadhouse reported that comparable sales at company restaurants were up 6.2% in the first five weeks of its fiscal third quarter.
Those figures are not directly comparable with Evercore's consumer observations, and they do not prove that current traffic remains equally strong. They do show that the two companies Evercore prefers, Brinker and Texas Roadhouse, carried positive sales momentum into the period.
Why affluent consumers matter
Higher-income households typically have more room for discretionary meals. If that group becomes cautious because of housing costs, interest rates, market volatility or weaker confidence, restaurants may need to rely more heavily on value offers to protect traffic. Discounts can support sales, but they can also reduce the benefit of menu-price increases and pressure restaurant-level margins.
The risk is not uniform across the sector. Brands with strong traffic, clear value and disciplined store operations can take share even in a slower environment. Brinker has recently benefited from strong Chili's performance, while Texas Roadhouse has continued to report positive comparable sales. Investors should therefore separate a broad consumer slowdown from company-specific execution.
What investors should monitor
The next earnings reports should be judged on traffic, not sales growth alone. Comparable sales can rise because of menu prices even when customer counts fall. Restaurant margin, labor and food-cost inflation, promotional intensity and management commentary on income cohorts will show whether demand is genuinely durable.
Evercore's call is constructive, not risk-free. BTI sees the near-term setup as mildly positive for EAT and TXRH because both entered the period with measurable sales momentum. A sustained traffic slowdown among affluent diners, however, would weaken that case quickly.