Denny's
The 10-second takeaway
For the quarter ended Sep. 26 (Q3), Denny's beat expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue contracted and GAAP earnings per share dropped significantly.
Margins dropped across the board.
Revenue details
Denny's recorded revenue of $120.9 million. The five analysts polled by S&P Capital IQ anticipated revenue of $118.4 million on the same basis. GAAP reported sales were 12% lower than the prior-year quarter's $136.7 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS details
EPS came in at $0.08. The six earnings estimates compiled by S&P Capital IQ averaged $0.09 per share. GAAP EPS of $0.06 for Q3 were 25% lower than the prior-year quarter's $0.08 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
Margin details
For the quarter, gross margin was 29.0%, 770 basis points worse than the prior-year quarter. Operating margin was 9.7%, 230 basis points worse than the prior-year quarter. Net margin was 4.4%, 140 basis points worse than the prior-year quarter.
Looking ahead
Next quarter's average estimate for revenue is $111.4 million. On the bottom line, the average EPS estimate is $0.08.
Next year's average estimate for revenue is $487.4 million. The average EPS estimate is $0.30.
Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 417 members out of 457 rating the stock outperform, and 40 members rating it underperform. Among 117 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 109 give Denny's a green thumbs-up, and eight give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Denny's is outperform, with an average price target of $5.40.
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