Despite the resurgence of COVID-19 cases dampening the restaurant industry’s growth prospects, relatively inelastic demand for food and a robust online presence are expected to help the industry grow this year and beyond. So, it could be wise to add quality restaurant stocks such as Dine Brands (DIN), Chuy’s (CHUY), and RCI Hospitality (RICK) to your portfolio now.With the resurgence of COVID-19 cases limiting traditional dining, the restaurant industry witnessed a setback. The National Restaurant Association’s Restaurant Performance Index (RPI) dropped to a 6-month low in August at 104.2, down 1.1% from 105.4 in July.

The industry is expected to see solid growth in sales this year, as many restaurants adopt advanced technology and increase digital offerings. The National Restaurant Association predicts that food and beverages sales will reach $789 billion by 2021. This is an increase of 19.7% over the previous year.

You might be smart to place your bets on strong fundamentally-strong restaurant stocks, such as Chuy’s Holdings, Inc., Dine Brands Global, Inc., or RCI Hospitality Holdings, Inc. They have a ‘Strong Buy’ rating in our POWR Ratings system along with an A or B grade for Quality.

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