The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how sit-down dining stocks fared in Q3, starting with Dine Brands (NYSE:DIN).
Sit-down restaurants offer a complete dining experience with table service. These establishments span various cuisines and are renowned for their warm hospitality and welcoming ambiance, making them perfect for family gatherings, special occasions, or simply unwinding. Their extensive menus range from appetizers to indulgent desserts and wines and cocktails. This space is extremely fragmented and competition includes everything from publicly-traded companies owning multiple chains to single-location mom-and-pop restaurants.
The 12 sit-down dining stocks we track reported a mixed Q3. As a group, revenues were in line with analysts’ consensus estimates.
In light of this news, share prices of the companies have held steady as they are up 2.5% on average since the latest earnings results.
Dine Brands (NYSE:DIN)
Operating a franchise model, Dine Brands (NYSE:DIN) is a casual restaurant chain that owns the Applebee’s and IHOP banners.
Dine Brands reported revenues of $216.2 million, up 10.8% year on year. This print fell short of analysts’ expectations by 1.7%. Overall, it was a softer quarter for the company with a significant miss of analysts’ EBITDA and EPS estimates.
Interestingly, the stock is up 15.4% since reporting and currently trades at $28.39.
Read our full report on Dine Brands here, it’s free for active Edge members.
Best Q3: Bloomin' Brands (NASDAQ:BLMN)
Owner of the iconic Australian-themed Outback Steakhouse, Bloomin’ Brands (NASDAQ:BLMN) is a leading American restaurant company that owns and operates a portfolio of popular restaurant brands.
Bloomin' Brands reported revenues of $928.8 million, down 10.6% year on year, outperforming analysts’ expectations by 2.7%. The business had a stunning quarter with a beat of analysts’ EPS and EBITDA estimates.
Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 11.4% since reporting. It currently trades at $6.40.
Is now the time to buy Bloomin' Brands? Access our full analysis of the earnings results here, it’s free for active Edge members.
Slowest Q3: Denny's (NASDAQ:DENN)
Open around the clock, Denny’s (NASDAQ:DENN) is a chain of diner restaurants serving breakfast and traditional American fare.
Denny's reported revenues of $113.2 million, up 1.3% year on year, falling short of analysts’ expectations by 3.2%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue estimates and a miss of analysts’ EBITDA estimates.
Interestingly, the stock is up 49.5% since the results and currently trades at $6.15.
Read our full analysis of Denny’s results here.
Darden (NYSE:DRI)
Founded in 1968 as Red Lobster, Darden (NYSE:DRI) is a leading American restaurant company that owns and operates a portfolio of popular restaurant brands.
Darden reported revenues of $3.04 billion, up 10.4% year on year. This print met analysts’ expectations. Aside from that, it was a slower quarter as it recorded a miss of analysts’ EBITDA estimates and full-year EPS guidance slightly missing analysts’ expectations.
The stock is down 17% since reporting and currently trades at $173.37.
Read our full, actionable report on Darden here, it’s free for active Edge members.
Red Robin (NASDAQ:RRGB)
Known for its bottomless steak fries, Red Robin (NASDAQ:RRGB) is a chain of casual restaurants specializing in burgers and general American fare.
Red Robin reported revenues of $265.1 million, down 3.5% year on year. This result beat analysts’ expectations by 3.3%. Overall, it was a very strong quarter as it also recorded a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ revenue estimates.
Red Robin scored the biggest analyst estimates beat among its peers. The stock is down 16.7% since reporting and currently trades at $3.92.
Read our full, actionable report on Red Robin here, it’s free for active Edge members.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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