By Doug Busch

While the broader market surges to all-time highs, several once-dominant groups are being left behind. Large-cap software, footwear, and casual dining have been unable to keep pace. High-profile names like Starbucks continue to lag, and the golden era of buyouts, from Applebee's to Panera Bread and Buffalo Wild Wings, feels like a distant memory.

Earnings season has only deepened the divide. Sweetgreen sank 23% on August 8 following disappointing results, and the selloff continued Tuesday after the close, with CAVA Group plunging more than 20%. On the technical front, CAVA's daily chart reveals a sharp breakdown below a head-and-shoulders pivot at 75, with little visible support until the $60 level, further reinforcing the bearish narrative.

CAVA Group was trading at $69.73 Wednesday.

Another name showing vulnerability in the casual dining space is Yum! Brands, currently riding a five-week losing streak. The powerhouse behind Pizza Hut, Taco Bell, and KFC finds itself at a critical technical juncture.

As the daily chart below illustrates, Yum is testing the important $140 level, a price point that acted as resistance three times in the latter half of 2024, before flipping to support after a February breakout. However, this support now appears fragile. A break below this key level would confirm a bearish descending triangle, potentially triggering a downside move toward $117 by year-end.

Yum! Brands was trading at $142.44 Wednesday.

Where there's turmoil, opportunity often lurks, and that might be the case for Shake Shack, down 17% year to date.

The stock sits roughly 27% below its recent 52-week highs, largely due to a sharp 15% drop following earnings on July 31. After falling another 5.6% last week, Shake Shack showed signs of resilience Tuesday, rallying 4% to complete a bullish morning star pattern. This bounce aligns with the gap fill from the May 9 session, suggesting a constructive setup just above the very round par number, provided the stock holds above the key support level near $95.

Shake Shack was trading at $106.53 Wednesday.

A standout in a challenging sector, Cheesecake Factory has shown notable resilience, up 31% year to date despite the fading mall traffic.

After a strong post-earnings gain, rare for the group, of over 5% on July 30, the stock is now testing its rising 50-day simple moving average (green line) for the first time since breaking out above a double-bottom handle trigger at 56.36 on June 3. This pullback often presents an ideal entry for those who missed the initial breakout. Trading near the lower end of its range between the key round numbers of 60 and 70, I remain bullish as long as it holds above 59.

Cheesecake Factory was trading at $61.75 Wednesday.

How long will the overall indigestion in this group last?

Write to Doug Busch at douglas.busch@barrons.com.

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August 13, 2025 13:55 ET (17:55 GMT)

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