EATZ: 2nd Quarter 2025 Portfolio Review
Portfolio
Performance
EATZ closed the second quarter of 2025 with a gain of 12.00% (NAV) | 12.02% (market), outperforming the S&P 500 Index, which rose 10.94% over the same period. As of June 30, 2025, EATZ maintained a Five-Star Overall Morningstar RatingTM within the Consumer Cyclical category*, placing it among the top-performing funds out of 48 peers based on risk-adjusted returns.
Winners and Losers
Several holdings posted strong gains during the quarter, benefiting from resilient demand and brand strength:
- DoorDash Inc. (DASH): up 34.87%, driven by growth in delivery volumes and expanded offerings.
- Brinker Internation Inc. (EAT): up 20.99%, reflecting improved traffic and menu innovation.
- Cheesecake Factory Inc. (CAKE): up 29.41%, supported by better-than-expected same-store sales and cost controls.
However, a few holdings experienced declines, weighed down by margin pressures, shifting consumer behavior, and challenges in international markets:
- Sweetgreen Inc. (SG): down -40.53%
- Yum China Holdings Inc. (YUMC): down -13.64%
- McDonald’s Corp. (MCD): down -5.94%
Portfolio
The fast-casual and quick-service restaurant segments continued to resonate with consumers during the quarter, offering an appealing mix of affordability, convenience, and quality. These categories remain particularly well-positioned to benefit from evolving dining habits, as price-sensitive consumers increasingly favor value-driven options without compromising on experience.
EATZ made a number of strategic portfolio adjustments in Q2, aiming to align with consumer demand trends and capitalize on growth-oriented opportunities.
EATZ reentered positions in:
- BJ’s Restaurants (BJRI): 2,700 shares
- Cracker Barrel (CBRL): 2,700 shares
- Red Robin Gourmet Burgers (RRGB): 30,000 shares
- One Group Holdings (STKS): 42,000 shares
Exited positions include:
- Performance Food Group Co. (PFGC)
- Portillo’s Inc. (PTLO)
- Sysco Corp. (SYY)
These moves reflect a continued emphasis on innovative brands with scalable platforms and growth potential, while reducing exposure to more mature names with limited near-term upside.
Top Holdings
| Ticker | Security Description | Portfolio Weight % |
| EAT | BRINKER INTERNATIONAL INC | 6.76% |
| NATH | NATHAN’S FAMOUS INC | 6.35% |
| DRI | DARDEN RESTAURANTS INC | 5.92% |
| CAKE | CHEESECAKE FACTORY INC/THE | 5.72% |
| TXRH | TEXAS ROADHOUSE INC | 4.79% |
| RRGB | RED ROBIN GOURMET BURGERS | 4.75% |
| USFD | US FOODS HOLDING CORP | 4.65% |
| STKS | ONE GROUP HOSPITALITY INC/TH | 4.65% |
| CBRL | CRACKER BARREL OLD COUNTRY | 4.51% |
| LOCO | EL POLLO LOCO HOLDINGS INC | 4.44% |
As of 06.30.2025. Cash is not included. Holdings are subject to change.
Please see our complete Fund holdings at advisorshares.com/etfs/eatz. The holdings details are updated each market day.
Market Update
The restaurant and dining industry continued to navigate a complex macroeconomic environment in Q2. Price sensitivity remained elevated, with many diners prioritizing value and convenience over traditional full service dining. This trend has benefitted the quick service and fast casual segments, which outperformed casual and fine dining as consumers shifted toward more affordable and efficient options.
Labor market conditions showed modest improvement, as staffing levels stabilized and turnover rates among hourly workers declined compared to previous quarters. However, rising input costs, particularly food and wages, continued to weigh on operators, requiring careful pricing and productivity strategies to protect margins. Higher income households maintained relatively stable dining patterns, while lower income groups increasingly opted for grocery purchases as compared to eating out – reflecting tighter budgets.
Looking ahead, industry performance will likely remain closely tied to the trajectory of inflation, shifts in monetary policy, and geopolitical developments. The quick service and fast casual categories appear best positioned to weather near term challenges and capitalize on enduring trends in convenience, digital engagement, and value driven dining experiences.
Cheers,Past Commentary
* The Morningstar Rating™ for funds, or “star rating,” is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product’s monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods. Past performance is no guarantee of future results.
©2025 Morningstar, Inc. All Rights Reserved. Morningstar and/or its content providers are the proprietors of this information; do not permit its unauthorized copying or distribution; do not warrant it to be accurate, complete or timely; and are not responsible for damages or losses arising from its use. Past performance is no guarantee of future results.
EATZ received five stars for the overall and 3-year rating among 48 funds in Morningstar’s Consumer Cyclical category as of 06.30.2025.
Definitions:
The S&P 500 Index is a broad-based, unmanaged measurement of changes in stock market conditions based on the average of 500 widely held common stocks. One cannot invest directly in an index.
Before investing you should carefully consider the Fund’s investment objectives, risks, charges and expenses. This and other information is in the prospectus or summary prospectus, a copy of which may be obtained by visiting www.advisorshares.com. Please read the prospectus carefully before you invest. Foreside Fund Services, LLC, distributor.
Investing involves risk including possible loss of principal. The hotels, restaurants & leisure industry is highly competitive and relies heavily on consumer spending for success. The prices of securities of companies in the industry may fluctuate widely due to general economic conditions, consumer spending and the availability of disposable income, changing consumer tastes and preferences and consumer demographics, in addition may be affected by the availability and expense of liability insurance. Legislative or regulatory changes and increased government supervision.
The success of companies owning and operating restaurants depends heavily on disposable household income and consumer spending, and changes in demographics and consumer preferences can affect the success of such companies. These companies may be subject to severe competition, which may have an adverse impact on their profitability. In addition, restaurants may be affected by nutritional and health concerns, and federal, state and local food inspection and processing controls. Changes in labor laws and other labor issues, such as increased labor costs, could adversely affect the financial performance of such companies.
Shares are bought and sold at market price (closing price) not NAV and are not individually redeemed from the Fund. Market price returns are based on the midpoint of the bid/ask spread at 4:00 pm Eastern Time (when NAV is normally determined), and do not represent the return you would receive if you traded at other times.
Holdings and allocations are subject to risks and to change.
The views in this commentary are those of the portfolio manager and may not reflect his views on the date this material is distributed or anytime thereafter. These views are intended to assist shareholders in understanding their investments and do not constitute investment advice.