I have fond memories of Denny's (NASDAQ:DENN). Through my college days, it was the glowing bastion of greasy grub that hit the spot at 3 a.m., when IHOP (NYSE:IHP) seemed just too fancy. That was before the company began to come undone with restrictive financials and accusations of racism.

These days, I drive by Denny's all the time, but I think it's been a good three to four years since I actually set foot in one of the 24/7 eateries. I guess I'm not like most of you, since Denny's has been posting some pretty impressive comps this year. The momentum slowed in the third quarter, with comps growing a mere 1.5% for the period, but at least it's popularity is still growing at the store level.

Revenues, though, rose by just 0.6% for the quarter ending in September. How can comps grow faster than a company's top line? Here's how: There are fewer units open now than a year ago. Denny's wrapped up the quarter 27 locations lighter.

No, that isn't an encouraging sign. The company did post a narrower loss, but that certainly isn't going to excite anyone hungry for a restaurant growth stock. The balance sheet is still a slippery skillet. And the substantial debt is enough to flip assets and liabilities to the point where Denny's is sporting a negative book value. That's not necessarily a deal-breaker for investors, though one has to understand that a leveraged company leaves itself with little wiggle room in case of failure.

Then again, watching P.F. Chang's (NASDAQ:PFCB) get knocked around this week may lead some food stock investors to appreciate the market's low expectations when it comes to Denny's. Given the company's bloated debt levels, an investment certainly is a risky proposition. But if the company can start living up to its "We're cooking now" slogan, maybe Denny's can live to see the day where its Super Bird truly flies high.

Denny's is a Motley Fool Hidden Gems Watch List stock.

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Longtime Fool contributor Rick Munarriz thinks he may give Denny's a chance sooner rather than later. He does not own shares in any of the companies mentioned in this story. The Fool has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.