Investing.com - Evercore reports that U.S. fast food same-store sales declined 0.5% in both April and May following positive growth earlier in the year, with trends weakening to negative 1% in the second half of May. The firm notes that casual dining same-store sales growth of 2% to 3% has outperformed quick service restaurants despite expectations for stronger results in the first half of the year.

Fast food same-store sales grew 0.5%, 2%, and 1% in January through March before turning negative in April and May. Evercore says hope remains for improved June performance as weather conditions improve following a cool and damp May, marketing initiatives intensify at leading chains including McDonald's FIFA collaboration, and consumers potentially adjust to gas price increases.

Casual dining chains have benefited from a double-digit jump in tax refunds and rising asset prices including stocks, though these tailwinds failed to bolster trends for most chains. Top steakhouse chains including Texas Roadhouse (NASDAQ: TXRH) and Darden's (NYSE: DRI) LongHorn showed evidence of the tax and wealth tailwind, but now face prospects of elevated beef costs if a Mexican border reopening is delayed by screwworm in the U.S.

Evercore continues to prefer Brinker International (NYSE: EAT) among casual dining names. The firm made same-store sales estimate changes to Chili's, Chipotle (NYSE: CMG), Tim Hortons, Burger King, Popeyes, and Taco Bell.

The research note indicates Gen Z and Millennials are pulling back on restaurant visits. Evercore's franchisee lender survey shows deteriorating willingness to fund many chains, while Starbucks (NASDAQ: SBUX) same-store sales trends remain strong.