A strip mall around the corner from where I used to live has three fast-food options.

One of them is Subway, which for the most part is relatively empty. The other is a Five Guys, which had lines out the door its first couple weeks after opening but has since tapered off.

fast-food-stock

The third fast-food joint is Chipotle (NYSE: CMG). That had long lines from day one. Lately, those lines have been growing longer.

It’s one Vermont man’s anecdotal evidence of Chipotle’s popularity. But I think it’s a microcosm for what’s happening nationally.

Fast food is a $191 billion industry in America. Forty-four percent of Americans eat at a fast-food restaurant at least once a week. Another 34% eat fast food at least twice a week. Six percent eat fast food at least once a day on average.

It’s only getting worse. By 2018, U.S. fast-food spending is expected to reach $210 billion. And we wonder why obesity has become an epidemic in this country. But that’s another topic for another day.

As a human being, those numbers may disgust you. As an investor, they should entice you.

Like it or not, fast food is big business. More importantly, it’s a growing business. To get a piece of that growth, it’s not a bad idea to own a fast food stock in your portfolio.

The Top Fast Food Stocks

McDonald’s (NYSE: MCD) has long been the popular fast-food choice of most investors – particularly income investors. It’s the largest fast-food chain in the world, with $27.6 billion in global sales in 2013. Historically, it has also been far and away the best-performing fast-food stock. If you bought McDonald’s shares in 1970, you’d be sitting on a return of better than 28,000%.

But McDonald’s greatest period of growth is clearly behind it. The stock is basically flat in the last year as global sales growth has slowed. Analysts are actually expecting a decline in earnings per share this year. Despite the 3.4% yield and the company’s 37-year history of annually growing its dividend, McDonald’s doesn’t hold the appeal it once did.

Burger King (NYSE: BKW), McDonald’s biggest rival, isn’t the answer, either. BK’s returns have been impressive since it went public again a little over two years ago, and it is growing earnings at a 19% clip. But the company has far more debt than cash, declining sales and, as my colleague Steve Mauzy put it, has a reputation for being “a plaything for financiers.”

Wendy’s (NYSE: WEN) has many of the same problems as Burger King, with revenues declining 19.5% last quarter and its debt outpacing its cash by nearly four to one. Plus, the stock has been sputtering of late, down more than 5% in the last year.

Which brings me back to Chipotle.

No fast-food stock has a better combination of earnings growth (25.5% year over year, with another 27.5% increase expected in 2015) and revenue growth (28.6%). It’s the only major fast-food company with zero debt, not to mention $804 million in cash.

Chipotle doesn’t pay a dividend and its $649 share price is enough to send sticker shock up your spine, which hopefully means that a stock split is imminent. But at a time when sales at most of the other big-name fast-food companies are either stagnating or backtracking, Chipotle’s are steadily growing.

Even after rising 53.5% in the last year, Chipotle stock looks like a good long-term investment. In an increasingly crowded fast-food landscape, Chipotle continues to find ways to stand out.

Especially in my old neighborhood.

*Full disclosure: I do not currently own shares of Chipotle (NYSE: CMG).

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