These 10 Restaurant Chains Are Doing Okay During the Coronavirus Pandemic

The coronavirus pandemic has been unprecedented for much of the restaurant industry. Dining rooms across the country closed as shutdown orders went into place, and even now, they have been slow to reopen as state and local officials are wary of another wave of infections.

Some chains have adapted to the crisis better than others, however. Not surprisingly, chains that have a strong delivery and takeout business have managed the crisis well, and the presence of drive-thrus have been particularly helpful.

Let's take a look at 10 restaurant chains that are surviving and even thriving, in some cases, during the crisis.

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The burrito chain may not seem like a pandemic winner as it's a fast casual brand with a lot of downtown locations near offices and few drive-thrus.

However, Chipotle (NYSE: CMG) has outperformed expectations, and the stock even recently touched an all-time high above $1,000. Its investments in digital ordering and delivery have paid off. Digital sales jumped 81% in the first quarter as customers took advantage of its free delivery promotion in March and April.

As of its last update on April 21 comparable sales had bottomed at 35% in the last week of March, but were only down in the high teens in the week before April 21 when it reported earnings, showing a quick recovery.

The company has no debt and a strong balance sheet, and management suggested the crisis could lead to it getting better real estate deals as it expands.

Jack in the Box (Nasdaq: JACK), the west-coast-based fast food chain has also held up well during the crisis. In its second quarter, which ended on April 12, the burger-and-fries slinger saw comparable sales fall by just 4.2%, though they were down 17% in the five-week period starting on March 8 when the pandemic first hit.

However, after April 12, comparable sales turned positive and improved every week up to May 10 when comps were up 8%, according to the company's last update. That's a favorable sign for the future and shows that customers are returning to the brand as local economies reopen.

A strong digital platform and a unique menu focused around comfort food has helped drive a sales surge at Wingstop (Nasdaq: WING) during the pandemic. While almost all restaurant chains saw a decline in sales during the height of the shutdown orders, Wingstop's comparable sales actually rose 8.9% between March 15 and March 28, and sales growth accelerated in the following month.

Management said comps soared by 33% in April, as digital sales accounted for 65% of its business, up from a pre-pandemic level of 40%, while takeout, which usually accounts for 80% of its business, became all of it.

Wingstop was already one of the strongest restaurant concepts before the pandemic, and its menu and business model is clearly resonating with customers right now.

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Wingstop isn't the only chicken chain that's seen sales surge recently. Popeyes, which is owned by Restaurant Brands International (NYSE: QSR), also came into the pandemic with substantial momentum as its popular new chicken sandwich led to skyrocketing sales last year.

In the first quarter, the brand saw comparable sales jump 26% even though sales were flat in the second half of March. However, it didn't take long for business to recover as management said that comps were trending up in the low 40s through the third week of May, showing that demand for the brand remains incredibly strong. Nearly all of its restaurants in the U.S. have reopened as well.

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Like Domino's, Papa John's (Nasdaq: PZZA) has also seen sales surge during the crisis. After posting comparable sales growth of 5.3% in North America in the first quarter, same-store sales surged by 26.9% in April and accelerated into May, jumping 33.5% between April 27 and May 24.

That's further evidence that the pizza delivery model is among the best positioned for the pandemic and the recovery period as management said that sales have been strong even as local economies have reopened. With Americans continuing to practice social distancing and eating inside restaurants being difficult, pizza delivery should remain popular for the coming months.

The drive-in chain is no longer publicly held as it was acquired by Inspire Brands in 2018 so we don't know the details of the company's performance. However, there is at least anecdotal evidence that sales at drive-in chains have boomed during the pandemic. Logically, the concept would figure to be a winner as customers eat in their cars by design.

Independently owned drive-in restaurants have reported a spike in sales so it makes sense that Sonic would also be doing well as it's the nation's largest drive-in restaurant chain with about 3,600 locations.

The privately-held chicken fingers chain is one of the most successful fast food businesses as its average restaurant sales reached nearly $3 million in 2018. With nearly all of its restaurants having drive-thrus and most of its sales coming from takeout, the company has done well during the pandemic.

Though sales fell as much as 30% during the beginning of the crisis, by the end of April they had recovered to pre-coronavirus levels, and in May, the company said it would hire another 2,000 employees, a sign that the chain had returned to growth.

In-N-Out has long had a cult following as the privately-held California-based chain has stayed true to its roots with a simple menu and only a few hundred locations around the country, driving strong demand and buzz.

As a privately-held company, In-N-Out doesn't report its sales figures, but reports on Twitter and elsewhere show that lines at its drive-thrus have been long during the pandemic. As a much-loved brand built around the drive-thru concept, it's not surprising that its locations would be busy.

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Zaxby's, another chicken fingers chain, has bounced back from the crisis, and is now seeing sales return to growth. The company has leaned on its drive-thrus, launched family packs to serve families that are sheltering in place, and gave relief to restaurant licensees. With the recovery in restaurant business in recent weeks, Zaxby's has seen systemwide sales increase 7.9% for the first three weeks of May.

Like other chains, Zaxby's recent performance shows that demand for chicken has been strong during the crisis.

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Though the previously-mentioned restaurant chains have been some of the best-performing during the crisis, the recent trends could change easily if dining rooms begin to open their doors, as right now fast-food chains have had relatively little competition from sit-down restaurants. There's still a lot of uncertainty ahead in the restaurant industry and in the overall economy as there could be pent-up demand for businesses that have been closed during the crisis.

Whatever happens, these 10 chains have proven their mettle, and will be able to manage through the crisis no matter what the future holds.

Jeremy Bowman owns shares of Chipotle Mexican Grill. The Motley Fool owns shares of and recommends Chipotle Mexican Grill and Twitter. The Motley Fool recommends Domino's Pizza. The Motley Fool has a disclosure policy.