The chips are down: pizza, fried chicken and doughnut shares plunge on ASX as living costs bite budgets
Once a symbol of cheap eating, fast food is transforming into a luxury many can no longer afford due to resurgent living costs.This shift is reflected on the ASX, where major pizza, fried chicken and doughnut outlets are seeing significant price drops, raising the question: are consumers so downbeat that they are even giving up on fast food?Shares in Domino’s Pizza, KFC operator Collins Foods and multi-brand food franchise owner Retail Food Group have all suffered double-digit falls over the past two months, coinciding with surging oil prices tied to the US-Israel war on Iran.The Guzman y Gomez share price is also down, even as the broader ASX has proven robust.Lochlan Halloway, an equity market strategist at Morningstar, says the stocks are under pressure because concerns over consumer spending are coinciding with fast-rising operational costs.“Fast food is a discretionary purchase, something that’s probably fairly easy to cut if your budget’s pinched, and so they might be a casualty of consumers just trading out of the category entirely,” Halloway said.
“You’ve also got costs increasing materially due to high fuel prices, interest rate concerns and other forms of cost pressures.You’ve got a squeeze from both ends.”Consumer confidence has plunged in Australia as anxiety over job prospects and employment security reaches levels not seen since the early pandemic, according to the closely watched Westpac-Melbourne Institute consumer sentiment index, released earlier in April.Consumer prices are growing at their fastest pace in two-and-a-half years, with inflation jumping to 4.6% in the year to March as the fallout from the fuel shock starts to ripple through the economy.
For many Australians, the sight of high prices on roadside fuel boards in March was enough to trigger an immediate response, with cafes reporting a fall in the sale of takeaway coffees, restaurants recording a pullback in spending, and sales of furniture, bedding and homewares sliding.The elevated fuel prices have coincided with interest rate rises, leaving many households paying more on their mortgages while grappling with rising fuel costs and living expenses.While many of the fast food stocks have not released updated revenue forecasts, the general pessimism has infected investors who assume customers are spending less on takeaway.There is a question over whether traditional fast food chains, including McDonald’s, are now seen as too expensive for what they offer in an increasingly competitive Australian market.The fast food market is highly sensitive to price changes, given customers constantly weigh the cost and convenience of buying takeaway.
“As far as the stock price reactions go, the market does have a tendency to overreact during these periods,” Halloway said.“But some selling is expected and probably justified, because this is a risk for the earnings outlook for these businesses.”Shares in ASX-listed Domino’s fell more than 10% in a single trading session on Tuesday after its US-listed namesake released underwhelming financials.Shares in Retail Food Group, which houses Gloria Jean’s, Donut King and Crust Gourmet Pizza, among other brands, have fallen more than 40% in 2026, while the stock price of KFC operator Collins Foods is down 25% over the past six months.While specific business issues have contributed to some of those falls, all have suffered from deteriorating consumer sentiment.
The sharp share price falls are somewhat counterintuitive given fast food stocks are traditionally resilient during economic downturns because they capture customers trading down from restaurants,Sophia Mulligan, investment analyst at Wilson Asset Management, says there are fears the “trade-down defensiveness” that had helped the sector in the past won’t hold this time,She says high petrol prices are also hurting traffic numbers, with a knock-on effect on drive-through sales,
How to turn old pitta into spiced chips – recipe | Waste not
Three years ago, I helped my friend, the chef Sam Webb, set up Babette, a street food stall at Newquay Boathouse. Webb and his team make everything from scratch and, wherever possible, using only local Cornish produce, from their hot honey (sourced from the Rescued Bee) to pitta with freshly milled flour from Cornish Golden Grains; he also grows his own produce with fellow restaurateur Matt Comley at Gannel Valley Gardens.As you might expect, saving food waste is at the top of Webb’s agenda, which is how he came to create waste-saving pitta chips to serve with hummus. It’s a recipe I couldn’t resist, not least because they take minutes to cook. What makes Webb’s pitta chips unique is their wonderful seasoning of sumac, za’atar and sea salt just before serving
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I first cemented the allure of the “chew” aged 14, working illegally as a chambermaid (I lied about my age) and finding a guest’s Gummy Bears laid open – a breach I heavily exploited. Recently this chew need has been sated by dates and their use in chocolate as a healthy caramel. Dates do have nutritional benefits over mere sugar: fibre, minerals, antioxidants and make a great pre-workout boost.The Guardian’s journalism is independent. We will earn a commission if you buy something through an affiliate link
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What’s the best birthday cake?Katie, by email“My mum once made a cake with mini rolls made to look like cats with googly eyes and strawberry lace tails,” says Nicola Lamb, author of Sift and the Kitchen Projects newsletter. And that’s the whole point of a birthday cake, right? It should align with the recipient’s favourite thing: “That could even be a lasagne,” Lamb says. “I’m not at all prescriptive about what you stick a candle into.”Of course, some cakes are a safer choice than others. Take the Victoria sponge: “I don’t think anyone is going to have a problem with a plush vanilla sponge, jam and cream job,” Lamb says
Rukmini Iyer’s quick and easy recipe for green chilli eggs with coriander and coconut | Quick and easy
This might look like a shakshuka, but with lemongrass, ginger and lime, you couldn’t really get away with calling it one – particularly because the noodles make this an easy, flavour-packed one-pan dinner. The crunch of the peanuts is particularly good against the lime-spiked coconut milk – a perfect transitional “is it spring yet?” dinner.Prep 15 min Cook 15 min Serves 21½ tbsp neutral oil 2 garlic cloves, peeled and grated½ stick lemongrass, finely chopped½-1 green chilli, finely chopped (remove the pith and seeds first if you want less heat)5cm piece fresh ginger, peeled and finely gratedJuice and zest of 1 lime 2 large echalion shallots (or small onions), peeled and finely sliced1 tsp freshly ground coriander seeds 1 tsp flaky sea salt 320g baby spinach400ml tin coconut milk, whisked smooth150g packet straight-to-wok medium noodles2 eggsTo serve 15g coriander, roughly chopped 50g salted peanuts, finely chopped½ green chilli, finely sliced (remove the pith and seeds first if you want less heat)Heat the oil in a large, deep frying pan on a medium heat, then add the garlic, lemongrass, chilli, ginger, lime zest and shallots. Stir-fry for four to five minutes, until the shallots are soft and the mixture is aromatic and starting to brown lightly, then turn down the heat and add the ground coriander and salt. Stir-fry for 30 seconds, add the spinach and cook for two minutes, until it is just wilting
A pasta bake and a sumac salad: Sami Tamimi’s prep-ahead sharing recipes
My ideal way of entertaining is completely fuss-free, with everything prepared ahead of time so I can enjoy being with my guests rather than worrying about cooking. I like to put big, generous dishes in the middle of the table, such as this one-tray chicken, pasta and chickpea bake, alongside a fresh salad, so everyone can serve themselves and share a simple, delicious meal.This is a comforting and flavourful dish that brings together tender chicken, hearty chickpeas and perfectly cooked pasta in a rich, pungent sauce. It’s a simple yet satisfying meal that’s ideal for busy weeknights or casual family meals. Everything cooks together in the oven, and the flavours blend beautifully while keeping prep and washing-up to a minimum
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