FRANDEX: Food and Non-Food Franchised Sectors Outperformed the Broader Indices

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The FRANdex, containing publicly traded franchise companies, show gains with both the food and non-food franchise sectors outperforming the broader market, according to analysts at FRANdata, an independent company that tracks and analyzes franchises and their performance.

Food and non-food franchised sectors outperform broader indices yet again. In the context of the gains recorded in 2013 and the disruptive weather, the stock market held up relatively well. For the quarter, S&P 500 was up 1.3%. Russell 2000 gained 0.8%, rallying for the seventh straight quarter. Investors are trading into equities with less risk and volatility, leading to correction in many market segments. Franchise companies advanced 2%, with both food and nonfood segments outperforming the broader market. The restaurant industry was a little under the weather in the latter half of 2013. Reversing this trend in the first quarter, food brands led the gains with a 2.6% return. Nonfood brands registered 1.3%.

Among specific names, Marriott continued to be one of the biggest gainers after adjusting for component weights, followed by Avis Budget Group and Burger King. GNC, which was one of the top performing stocks in 2013, incurred the largest loss in the first quarter, followed by Tim Horton’s and InterContinental Hotels. In aggregated term, FRANdex remains strong and outperforms the broader indices. Its period-over-period changes were on average 0.9% higher than that for S&P and 0.6% above that for Russell, based on the actual index levels without normalization over the past 33 quarters.

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About FRANdex and FRANdex+M
FRANdex and FRANdex+M track the performance, based on market capitalization, of the largest 44 and 45 U.S. publicly-traded companies, respectively, that use the business format franchising model. Collectively the companies operate 107 franchise brands. All index levels are normalized to 1,000 at Q1 2006 for comparison purposes and all remaining periods are adjusted accordingly. FRANdex+M includes the McDonald's Corporation. Since McDonald's represents more than 25% of the overall market capitalization of publicly-traded franchise companies, it is excluded from FRANdex but included in FRANdex+M for comparative purposes. FRANdex includes publicly traded companies where franchising is material to the company's financial performance and business operations.

About FRANdata
FRANdata is an independent research company that tracks and analyzes franchises and their performance. For the past 25 years, the Arlington, Va.-based company has often been called upon by investors and private equity firms to help them identify brands that meet their target performance metrics, and provide due diligence research as the deal progresses. FRANdata is often cited as an expert in such leading media as The New York Times, The Wall Street Journal and The Washington Post. Additional information is available on the company's website,

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Meme Moy
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