Dine Brands Global (NYSE:DIN) Releases Quarterly Earnings Results, Misses Expectations By $0.19 EPS

Key Points

• Adjusted EPS was $0.82, missing analyst expectations of $1.01 by $0.19, though it rose from $0.73 a year earlier. Net income also declined year over year.
• Revenue increased 15.2% to $248.9 million, beating estimates of $239.7 million. Applebee’s and IHOP domestic same-restaurant sales grew 0.9% and 0.8%, respectively.
• Management said recent trends were mixed and expects full-year results near the low end of guidance; higher commodity costs and a sharp decline in nine-month adjusted free cash flow added pressure.

Dine Brands Global (NYSE:DIN - Get Free Report) issued its quarterly earnings results on Wednesday. The restaurant operator reported $0.82 earnings per share for the quarter, missing analysts' consensus estimates of $1.01 by ($0.19), FiscalAI reports. The company had revenue of $248.90 million during the quarter, compared to analyst estimates of $239.71 million. Dine Brands Global had a net margin of 0.75% and a negative return on equity of 20.34%. The business's revenue for the quarter was up 15.2% on a year-over-year basis. During the same period in the prior year, the business earned $0.73 EPS.

Here are the key takeaways from Dine Brands Global's conference call:

• Applebee’s and IHOP posted modest domestic same-restaurant sales growth of 0.9% and 0.8%, respectively. Adjusted EBITDA was flat at $49 million, while adjusted diluted EPS increased to $0.82 from $0.73 a year earlier.
• Management highlighted continued progress in growth initiatives: Applebee’s off-premise sales rose 1.8%, while IHOP off-premise sales increased 5.6% and catering sales grew 44%. Dual-brand restaurants are averaging roughly 1.5 to 2 times the sales of standalone locations, with a strong 2027 pipeline, according to management.
• Management said Q4 trends have been mixed, with Applebee’s starting soft, and expects full-year results near the low end of guidance. Applebee’s and IHOP commodity costs rose 5.4% and 1.3%, respectively, with beef prices a key pressure.
• Adjusted free cash flow for the first nine months fell to $12.8 million from $68.2 million a year earlier, as operating cash flow declined and capital spending increased for remodels and dual-brand conversions. The company-owned restaurant segment is still expected to post a loss in Q4, though management said its oldest portfolio cohort is profitable.

Dine Brands Global Price Performance

NYSE DIN traded up $1.22 during trading on Wednesday, reaching $36.53. 794,558 shares of the company's stock were exchanged, compared to its average volume of 670,163. The business has a 50 day moving average price of $30.93 and a 200-day moving average price of $31.70. The stock has a market capitalization of $462.47 million, a P/E ratio of 8.35 and a beta of 0.93. Dine Brands Global has a fifty-two week low of $23.23 and a fifty-two week high of $39.68.

Dine Brands Global Announces Dividend

The business also recently declared a quarterly dividend, which was paid on Friday, October 9th. Shareholders of record on Wednesday, September 16th were given a dividend of $0.19 per share. The ex-dividend date of this dividend was Wednesday, September 16th. This represents a $0.76 annualized dividend and a dividend yield of 2.1%. Dine Brands Global's payout ratio is 161.70%.

Trending Headlines about Dine Brands Global

Here are the key news stories impacting Dine Brands Global this week:

• Positive Sentiment: Revenue rose 15.2% year over year to $248.9 million, beating analyst expectations of $239.7 million. This growth is a positive sign for sales momentum at the Applebee’s and IHOP owner. Third-quarter results
• Neutral Sentiment: Dine Brands rejected a $39-per-share takeover proposal and adopted a stockholder rights agreement. The offer signals potential acquisition interest, but its rejection and the rights agreement may make a transaction harder to pursue; a sale is not assured. Takeover proposal Stockholder rights agreement
• Negative Sentiment: Adjusted earnings of $0.82 per share fell short of the roughly $1.01 analyst consensus, despite rising from $0.73 a year earlier. Net income also declined to $4.6 million from $7.3 million, adding pressure to the otherwise solid revenue report. Q3 earnings miss Sales rise, profit slips

Analyst Ratings Changes

A number of brokerages recently commented on DIN. Weiss Ratings reiterated a "hold (c-)" rating on shares of Dine Brands Global in a research report on Friday, September 4th. Piper Sandler upped their target price on shares of Dine Brands Global from $28.00 to $37.00 and gave the company a "neutral" rating in a research report on Monday, August 10th. Raymond James Financial reaffirmed a "market perform" rating on shares of Dine Brands Global in a research note on Wednesday. Freedom Broker upgraded shares of Dine Brands Global to a "hold" rating in a research report on Monday, August 24th. Finally, Zacks Research raised shares of Dine Brands Global from a "strong sell" rating to a "hold" rating in a research note on Tuesday, September 15th. Ten research analysts have rated the stock with a Hold rating. According to data from MarketBeat.com, Dine Brands Global currently has an average rating of "Hold" and a consensus target price of $33.25.

Dine Brands Global Company Profile

Dine Brands Global, Inc is a franchisor and full-service restaurant company that operates a portfolio of well-known dining concepts. Its primary brands are Applebee's Neighborhood Grill + Bar, which offers casual American dining, and IHOP, which specializes in pancakes, breakfast foods and other all-day meals. The company also owns Fuzzy's Taco Shop, a fast-casual Mexican restaurant brand acquired in 2022.

Dine Brands generally operates through a franchise-based business model. Independent franchisees own and operate most restaurants under the company's brands, while Dine Brands provides brand management, restaurant development support, marketing, training, technology and other services.

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