Source: Ruby Tuesday.  

Another chain that thought it could take on Chipotle Mexican Grill (NYSE:CMG) is throwing in the taco towel. Ruby Tuesday (NYSE:RT) announced yesterday that it has completed the sale of its Lime Fresh Mexican Grill brand to EverFresh Endeavors. A mere $4.6 million is all it took to snag the intellectual property and franchising rights for Lime Fresh Mexican Grill. It had previously unloaded some of its Florida locations in a $6 million deal to Rubio's Restaurants, a move that will see those locations shuttered and transformed into Rubio's Coastal Grill later this year.  

Ruby Tuesday acquired Lime Fresh four years ago for $24 million, hoping that the fast casual chain could ride Chipotle's coattails. The menu at Lime Fresh offers Chipotle staples including burritos, rice bowls, tacos, quesadillas, and salads. It also expands on the national Chipotle offerings with tortilla soup, baked nachos, and fajitas. 

A fast casual burrito concept in the hands of a seasoned operator with a national presence could've worked, but it never gained traction. It flopped, and over the past year alone Lime Fresh has shuttered half of its company-owned locations. Even now with Chipotle sputtering through negative comps since late last year on food safety concerns, Lime Fresh wasn't able to capitalize the way that other Chipotle wannabes have been doing. 

Ruby Tuesday wants to focus on its namesake concept, but it's not as if spending more time on its causal restaurant chain has resulted in a favorable solution in the past. 

Goodbye, Ruby Tuesday

Shares of Ruby Tuesday hit fresh seven-year lows two weeks ago. Investors are as excited about Ruby Tuesday stock as potential patrons are about eating at the chain. It's coming off of another disappointing quarter of declining revenue, negative comps, and contracting margins. It also didn't help nurture confidence to see its CFO leave in July, starting up as CFO at Cracker Barrel (NASDAQ:CBRL) a few days later.

You can't blame a bean counter for leaving Ruby Tuesday hitting new lows to join Cracker Barrel, scoring a new all-time high yesterday. Cracker Barrel turned heads this week after another strong report, raising its quarterly dividend to $1.15 a share and declaring a special one-time payout of $3.25 a share. Put another way, Cracker Barrel investors will be receiving more in dividends this summer than the market value of a share of Ruby Tuesday. 

Ruby Tuesday's rut has been a series of failed turnaround efforts. It's revamped the menu in the past, experimenting on both ends of the pricing spectrum in casual dining. If you step into a Ruby Tuesday you may not recognize it from the last time you went in several years earlier, as the vibe has gone from imitation Tiffany lamps and bric-a-brac decor to dark woods and leather banquettes to what is now a new look with a revamped Garden Bar.

Lime Fresh wasn't a distraction. It was a second chance to get it right. It didn't happen, and the road to turn the original concept around won't be any easier now. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.