Added to YB: 2024-06-04
Pitch date: 2024-06-03
DENN [bullish]
Denny's Corporation
-16.67%
current return
Author Info
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Company Info
Denny's Corporation, through its subsidiaries, owns and operates franchised full-service restaurant chains under the Denny's and Keke’s Breakfast Cafe brand names in the United States and internationally.
Market Cap
$316.2M
Pitch Price
$7.44
Price Target
10.95 (+77%)
Dividend
N/A
EV/EBITDA
9.94
P/E
31.31
EV/Sales
1.60
Sector
Hotels, Restaurants and Leisure
Category
value
Quick Value #220 - Denny's Corp (DENN)
DENN: 96% franchised diner down 65% in 5yrs. Cheap at 7.3x EBITDA, <10x FCF. Heavy buybacks: shares -48% since 2010 (5.5% CAGR), $700M+ spent. Despite unit count -8.6% since 2013, franchise profit hit $126M record in 2023. Pre-COVID: 22x P/E, growing EPS. Now: 11x P/E, choppy EPS. Among cheapest in peer group. Buybacks significant: 10-20% of mkt cap since 2016. Stabilizing core brand could drive 25-50% upside. Risks: Inflation headwinds, slowing buybacks, franchisee margins. Keke's expansion requires capex.
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