What happened

Shares of BJ's Restaurants (NASDAQ:BJRI), Dave & Buster's Entertainment (NASDAQ:PLAY), and Dine Brands (NYSE:DIN) were all running higher at double-digit percentage rates in midday trading Wednesday as more states planned for business to begin reopening. 

So what

While takeout and delivery has been a lifeline for restaurants to hang on to during the pandemic lockdown, being able to seat customers on a regular basis is essential for their survival. Like other businesses, they've had to draw down their credit lines to maintain liquidity to make it through the mandatory shutdown.

Waiter serving guests at a restaurant

Image source: Getty Images.

Last week, BJ's said comparable restaurant sales have plunged 82% since March 24, but are improving due to mid-teen percentage rate gains in off-premises sales. CEO Greg Trojan said the restaurant is "preparing to begin reopening restaurants once state and local officials allow us." 

Shares of BJ's Restaurants are up 13% today and have surged over 250% after hitting a low point of $6 a share in mid-March. Investors, though, will get a closer look at the damage the coronavirus caused when the restaurant operator reports earnings on May 7.

Similarly, Dave & Buster's plunged below $5 a stub as it was forced to furlough virtually all of its 15,000 hourly employees, management and corporate staff was reduced by 90%, it initiated pay cuts, and closed its restaurants. 

It was already experiencing a significant downturn in business before the pandemic hit and was introducing new concepts to attract more customers to its restaurants. CEO Brian Jenkins told analysts last quarter, "Currently, our dining rooms are the least-visited space in our four walls." That has only been exacerbated by the current crisis, and states reopening could help the chain get back to turning its business around. 

Dine Brands, however, is surging 25% today on its earnings report this morning for the period ending March 31, and though most of its restaurants remained open for takeout and delivery, comparable sales at Applebee's were down 10.6% and off more than 14% at IHOP.

CEO Steve Joyce said, "The physical distancing measures, shelter-in-place orders and government mandates requiring restaurants to close dining rooms, while critical to flatten the curve, have made a significant impact on the operations of our business and that of the entire industry."

Still, Dine Brands' results beat analyst expectations, and with $395 million in cash available to it, the restaurant operator believes its asset-light business model provides sufficient liquidity to make it through the crisis.

Now what

Business reopenings have started or are imminent in Colorado, Georgia, South Carolina, Tennessee, and Texas, with more lining up daily. 

Restaurants have said when they open they'll keep social distancing guidelines in mind when determining the number of customers to allow in and how to seat them at tables. But the stocks of these restaurants will likely exhibit volatility for some time to come.