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Monday, Jun 5, 2023

DineEquity: ‘Worst Restaurant Stock of Year’

There’s no doubt that Glendale’s DineEquity had a difficult 2017, what with unappetizing earnings, a departed chief executive and slowing traffic. Yet another low point was hit Friday when a leading stock-monitoring website put out a list showing that DineEquity was the worst-performing restaurant stock of the year. Seeking Alpha, a website for stock watchers and analysts, said that among all restaurant companies with market capitalizations of at least $300 million, DineEquity’s stock was down 35.5 percent for the year with only a week left. The restaurant chain, which mostly franchises IHOP and Applebee’s restaurants, saw same-restaurant sales decline 2.5 percent and 7.3 percent, respectively, through the first nine months of the year. Foot traffic has been slipping all year, and Julia Stewart, the longtime chief executive and chairwoman, resigned in February amid the dreary numbers. The Cheesecake Factory, based in Calabasas, fared only a bit better. Its stock declined 17.8 percent, coming in as 2017’s seventh-worst performing restaurant stock of the year so far. On the other end of the spectrum, McDonald’s had a good year. The No. 1 restaurant stock performer of the year was Arcos Dorados Holdings, which franchises McDonald’s restaurants in 20 Latin American countries. Its stock was up 88 percent. (Arcos is in Uruguay but its shares are traded on the New York Stock Exchange.) McDonald’s itself came in at No. 4 on the best-performing list with an increase of 41.2 percent. Restaurant stocks as a whole were up 14.9 percent. If there’s any solace in it for DineEquity, a different list which came out Thursday showed the Glendale company was not the worst-performing restaurant company. That other list, from the Motley Fool, used a market-cap cutoff of $200 million, so it included smaller companies. It said the worst performer of the year was Irvine’s Habit Restaurants, down 42.3 percent. DineEquity’s stock, according to Motley Fool, was down 35.3 percent, tying it for second worst.

Charles Crumpley
Charles Crumpley
Charles Crumpley has been the editor and publisher of the San Fernando Valley Business Journal since March 2016. In June 2021, it was named the best business journal of its size in the country – the fourth time in the last 5 years it won that honor. Crumpley was named best columnist – also for the fourth time in the last 5 years. He serves on two business-supporting boards and has won awards for his civic involvement. Crumpley, a former newspaper reporter, won several national awards and fellowships for his work, and he was a Fulbright scholar to Japan.

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