QSR enters the post-earnings session holding a paradox: short sellers doubled down aggressively into a stock that just beat expectations and closed up more than 4% on the week at $81.67.
Short interest has surged roughly 120% over six weeks. It hit 6.2% of the free float on May 5, up from barely 2.8% in late March. The weekly jump alone was 27%. That rate of accumulation is striking for a defensive quick-service franchise name — Restaurant Brands International reports earnings today, beat Q1 expectations across its Burger King, Tim Hortons, and Popeyes brands, and the stock has still attracted a near-record short build. The ORTEX short score has climbed every session this month, reaching 45.8 on May 5, its highest reading in the observed window. Bears are building, but so far the tape is going against them.
Options positioning reinforces that the short build is happening into a broadly bullish backdrop. The put/call ratio has dropped to 0.41, well below its 20-day average of 0.46, and has been trending lower since early April when it touched 0.75. That sustained decline in the PCR reflects growing call-side participation — the market is not hedging into earnings, it is buying upside. The divergence between the rising short interest and the falling put/call ratio is the clearest tension in the setup: shorts are rebuilding in the borrow market while options traders are not providing the put-side corroboration that would normally accompany a heavy short build. Borrow itself remains almost frictionless — cost to borrow ticked up 19% on the week but reaches only 0.55% APR, and the lending pool is far from stressed.
The Street gave QSR a broad lift heading into Q1 results. Every analyst action in the past two weeks was a target raise, with no rating downgrades. UBS lifted its Buy-rated target to $90 from $85, JP Morgan raised its Overweight target to $80, RBC bumped to $90, and Citigroup moved to $88 from $76 — all maintaining existing ratings. TD Cowen sits as the outlier, raising to $79 while keeping a Hold, and today reiterated that view post-print. The consensus mean target is $84.07, roughly 3% above the current price, which puts QSR trading close to but not through the average Street view. The forward P/E is running at 19.5x, up roughly a full turn over the past month, and EV/EBITDA has moved to 13.6x. EPS momentum over the past 90 days scores in the 60th percentile, and the forward EPS growth factor ranks near the top at 79th — the fundamental read is constructive, and the multiple expansion over April has been modest rather than stretched.
Insider selling, the most recent signal from within the company, paints a less enthusiastic picture. CEO Joshua Kobza sold 200,000 shares in mid-March at roughly $75, a $15 million disposal. CFO Sami Siddiqui sold 80,000 shares across two days at similar levels. The General Counsel and Chief Accounting Officer also sold in the same window. The cluster of C-suite disposals is the kind of noise that bears would cite — insiders lightened up before a near-10% price gain — but the trades all came around $73-75 and occurred some six weeks before the Q1 beat, so they tell you more about where executives valued the stock then than where it is now. The net 90-day insider position is technically slightly positive at roughly 500,000 shares net, though that reflects option-related mechanics rather than open-market buying.
The institutional picture is steady and anchored by Canadian flows, reflecting QSR's Toronto-listed parentage. BlackRock added 3.5 million shares to reach 6.6% in Q1, and both Morgan Stanley and the Toronto-Dominion Bank meaningfully grew positions. RBC Dominion Securities trimmed sharply, but asset management arms at RBC and TD were steady buyers, suggesting the Canadian institutional base remains largely committed.
The next earnings event is pencilled in for June 3. Between now and then, the key dynamic to monitor is whether the short interest build stalls or continues to climb into the mid-to-high single-digit range, and whether post-Q1 enthusiasm in the options market holds or gives way to the put-buying that has so far been conspicuously absent.
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