There's nothing quite like swinging to a huge loss to spoil investors' appetites for your stock.

Image source: Wikimedia Commons. 

On Thursday, casual-dining chain Ruby Tuesday (NYSE:RT) did just that by reporting a quarterly net loss of $22.2 million, or $0.37 per diluted share, compared to a net income of $2.6 million, or $0.04 per share, in the same year-ago period.

Quarterly revenue also fell 11.7% year over year to $288.1 million.  

For reference, analysts on average were expecting a significantly smaller net loss of $0.06 per share on sales of $298.6 million.

Naturally, the big miss gave investors plenty of reason to crush the stock to the tune of 18% on Thursday.

Blame the economy...
If you're searching for a culprit, Ruby Tuesday CEO J.J. Buettgen said in a press release you should look no further than our faltering economy, which "failed to realize any significant improvements [and] adversely affected us and the casual dining industry."

As a result, Buettgen stated, same-restaurant sales came in well below the company's expectations, decreasing 11.4% at company-owned locations and 8.4% at domestic franchised restaurants.

What's more, Ruby Tuesday was left with just $35.9 million in cash at the end of last quarter, a more than 45% decrease from its cash balance this time last year. Perhaps it should come as no surprise, then, that the company says it is finalizing a new four-year, $50 million revolving credit facility to help keep it afloat, with an anticipated closing by the end of the current quarter.

I suppose that's fair enough. After all, shares of casual dining competitor Darden Restaurants (NYSE:DRI) also took a hit two weeks ago after it said same-restaurant sales for its two largest core concepts, Olive Garden and Red Lobster, respectively fell 4% and 5.2%. Of course, those drops weren't nearly as large as Ruby Tuesday endured, and Darden can at least fall back on its other (albeit smaller) fast-growing brands, including LongHorn Steakhouse, for which comps actually grew 3.2% last quarter.

Then again, not everyone in the casual-dining space has fared so badly of late. Take Red Robin Gourmet Burgers (NASDAQ:RRGB), for example, which popped 10% when it reported 4.3% same-store sales growth at company-owned restaurants in August, largely the result of intelligent price increases even in the face of slightly lower guest counts, which were down 0.7%.

Of course, Red Robin won't be able to keep raising prices forever, but it's telling that customers were largely willing to accept paying a higher check in the first place.

Buffalo Wild Wings (NASDAQ:BWLD) also bucked the negative trend last quarter by achieving positive comps at company-owned locations of 3.8%, benefiting not only from its unique, enjoyable atmosphere, but also from lower chicken wing prices and a revised price structure that customers were more than happy to accept. In fact, I was so impressed by Buffalo Wild Wings' performance that I even decided to buy shares for the first time in my personal portfolio last week.

But don't get me wrong; I don't mean to understate the challenges Ruby Tuesday is facing in today's increasingly difficult financial climate. In addition, remember both Buffalo Wild Wings and Red Robin are set to announce third-quarter results over the next month or so. Given the declining trends in the industry as a whole, then, I wouldn't be surprised to see both chains' same-restaurant sales growth wane.

I would be shocked, however, if their performance in the most recent quarter was anywhere near as painful as Ruby Tuesday's, which last quarter posted respective same-store declines in company and franchised locations of 3.1% and 5.1%.

In the end, that's why I'm convinced Ruby Tuesday is quickly losing steam as stronger competitors are more than willing to pick up the slack.

That won't bode well for shareholders going forward, so I'm afraid today's drop may only be the beginning.