Restaurant Brands International

None of the warning signs we check for were found.

We look for five warning signs: doubt it can keep going, weak checks on its own accounts, a notice that its past accounts can't be relied on, a change of auditor, and one customer bringing in a big share of sales. We don't check lawsuits, investigations or debt yet.

We checked the auditor's report, internal controls, restatement notices, auditor changes and big customers in the 10-K filed 20 Feb 2026, plus the 10-Q filed 6 Aug 2026 and 4 later 8-Ks.

• It carries a lot of debt: 3.7× its equity.

Whether the price already reflects the risks is what the deep dive is for.

• Our acquisition and operating of material portfolios of Company restaurants exposes us to additional risk and could adversely affect our operating margins and cash flows.

  We may from time to time acquire, directly operate, and refranchise portfolios of certain system restaurants to pursue strategic goals. As of the date of this Annual Report on Form 10-K, we directly operated approximately 5% of our total restaurants, primarily as a result of the Carrols Acquisition in May 2024. Acquisition activities inherently subject us to a number of risks and uncertainties as the acquired restaurants may fail to achieve the benefits we expected and may be subject to debt or other liabilities that are difficult to refinance or restructure at attractive rates, or at all, particularly if we are required to place greater reliance on the financial and operational representations and warranties of the sellers. Furthermore, operating a material portfolio of restaurants can expose us to additional risks or exacerbate those risks to which we are already exposed as a franchisor. For example, as a result of the Carrols Acquisition, we materially increased our employee count, which exposes us to additional liability and costs, such as risks associated with minimum wage increases and other mandated benefits, increased costs arising from third-party and self-insured health care insurance, employment and labor liability and regulatory compliance risks. We could also be subject to additional liability such as property, environmental, and other liability as a result of being a direct operator and lessee of additional restaurants and liability arising from regulatory compliance. Risks associated with increases in commodity prices, fuel prices, or other costs associated with operating restaurants are also exacerbated when we are the operator rather than the franchisor of our restaurants. Furthermore, in connection with the Carrols Acquisition we recorded significant assets, including goodwill. To the extent we do not fully realize the strategic goals, financial returns, and other benefits of our portfolio acquisition and refranchising activities within the timeframe or to the extent originally anticipated, we may be required to recognize asset impairments and/or accounting losses from time to time based on the valuation implied by refranchising transactions.

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