Shares of Popeyes Louisiana Kitchen fell more than 6 percent on Tuesday after the company hit its all-time high Monday following a report that Restaurant Brands International had approached the fried chicken chain to express interest in an acquisition.
Popeyes intraday chart
Both Restaurant Brands and Popeyes declined to comment to CNBC, saying they do not comment on market rumors.
Some had welcomed the idea of a deal, seeing it as a way to help the Georgia-based Popeyes reach more global diners and boost Restaurant Brands' already strong roster of restaurants.
"In our view, a proposed buyout of PLKI by QSR is plausible. We believe the Popeyes acquisition would provide Restaurant Brands a concept that provides steady organic and unit growth in both the North American and overseas markets," Stephen Anderson, an analyst at Maxim Group, wrote in a research note Tuesday.
He added that Popeyes has "shown stronger performance worldwide in the past two years" compared to Restaurant Brands' Burger King and Tim Horton's chains.
However, some analysts are skeptical about the deal.
"The most apparent question to us is what does Restaurant Brands gain from acquiring Popeyes?" Andrew Charles, a Cowen analyst, wrote in a research note Tuesday. "In our view, Restaurant Brands has not accomplished the primary objective of acquiring Tim Horton's, which was growing the brand internationally."
Charles noted that it took the company longer than expected to signed franchise development agreements in the Phillippines, United Kingdom and Mexico. He suggested that this could mean that Restaurant Brands is not "ready to acquire another brand."
The Oakville, Ontario-based company also saw its stock fall Tuesday, down just under a percent in intraday trading.