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Apair of damning reports predicted some dark times for the industry ahead.

Paul Westra, an analyst with Stifel, issued a report saying the firm issued a “restaurant recession outlook.” On the same day, Jefferies analyst Andy Barish issued a report calling this the top of the restaurant cycle.

Westra sees the recent 1.5 percent to 2 percent same store sales deceleration across the industry as an indication of grim times ahead.

“Historically, restaurant industry-wide comps have decelerated -200bps to -300bps about three-to-nine months prior to the start of the 2001 and 2008 recessions,” wrote Westra, referring to basis points. “We see an eerily similar trend having started in 2Q16, implying a likely 2017 U.S. recession.”

Westra predicts an average 20 percent stock price drop across restaurant categories and an average comp decline of 2.5 percent in the second half of 2016. He said it will be even worse this time because restaurants are already benefitting from low commodity prices typically seen during a recession.

Barish’s vision of grim years ahead points to the persistent unit growth as a major drag on the industry. Built with ample capital, industry unit growth has returned to “1 percent to 1.5 percent (about the same as peaks of the last cycle in ’05-’07) and broader spending growth is not translating to same store sales,” wrote Barish.

He said the emergence of small independent chains are also aggravating the trend as they expand, buoyed by the same easy capital and big investments that established brands enjoyed in past cycles.

Barish does see a silver lining. As the industry cools off, margins may actually improve as restaurant companies get serious about data, cost cutting when unit growth isn’t a revenue driver.

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