According to a new report from Bank of America Securities, McDonald's is under the most pressure because it has limited exposure to Russia.
McDonald's, which owns a large majority of its restaurants in Russia, has been quiet about the Russian invasion of Ukraine. The company refused to speak to CNBC on Monday.
Most of the restaurants in Russia and Ukraine are operated by franchisees, meaning they have avoided greater exposure to the countries. It also means that a significant economic downturn in either country is less likely to hurt the company's results. Even if the chain is based in the U.S., the franchisor and franchised restaurants can point to their local ownership.
McDonald's opened its first location in the Soviet Union in 1982. 2% of its system-wide sales come from those restaurants, 9% of its revenue and 3% of its operating income.
The company's ownership has gone from 100% to about 80% of its restaurants.
After Russia was hit with sanctions in response to its annexation of the Crimean Peninsula, there was a negative reaction against American companies, including McDonald's.
The rest of McDonald's Russian footprint is owned by franchises.
According to Senatore, a bigger threat to McDonald's business is whether the conflict spills over into the rest of Europe. A quarter of McDonald's system-wide sales come from the continent. Senatore thinks that the region could make a third of its operating profit.
According to Senatore, Starbucks only makes about 5% of its sales from Europe. All of the cafes in Russia are run by franchisees. Kevin Johnson promised to donate royalties from his Russian business to humanitarian causes in Ukraine after condemning the Russian attack on Ukraine.
More than 1,000 restaurants in Russia account for 2% of the total sales of the company. The vast majority of those locations are franchised, so the revenue that Yum receives through licensing fees is much smaller.
We are shocked and sad by the events in Ukraine, and we are focused on the safety of our employees, franchisees and partners in the region.
It is too early to discuss the impact, but the company is closely watching the situation. The foundation is giving $1 million to the Red Cross and matching employee donations to charity.
Domino's Pizza and Burger King are owned by Restaurant Brands International, which also has restaurants in Russia and Ukraine.
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