In a challenging market environment, Denny’s Corporation (NASDAQ:DENN) stock has touched a 52-week low, dipping to $4.82. The family dining chain, known for its round-the-clock service and classic American diner fare, has faced significant headwinds over the past year, reflected in a steep decline of nearly 46%. Trading at a P/E ratio of 11.8x and with analysts setting price targets between $6 and $8.50, InvestingPro analysis suggests the stock may be undervalued at current levels. This downturn marks a concerning period for the company as it navigates through a landscape marked by shifting consumer habits and economic pressures. Despite these challenges, management has been actively buying back shares, demonstrating confidence in the company’s future. Investors and analysts are closely monitoring Denny’s performance and strategies for recovery as the stock currently hovers at this low point. For deeper insights into Denny’s financial health and growth prospects, access the comprehensive Pro Research Report available on InvestingPro, which includes 10+ additional exclusive ProTips and detailed analysis.
In other recent news, Denny’s Corporation reported its fourth-quarter financial results, revealing adjusted earnings per share of $0.14, which fell short of the analyst consensus estimate of $0.15. The company’s revenue for the quarter was $114.7 million, missing the anticipated $116 million. This shortfall was attributed in part to the accelerated closure of franchisee-operated restaurants, as Denny’s aims to eliminate 150 underperforming units by the end of 2025. Despite this, Denny’s managed to align its adjusted earnings before interest, taxes, depreciation, and amortization with consensus expectations at $22.2 million.
Benchmark analysts responded to the financial results by lowering their price target for Denny’s stock to $8 from $10, while maintaining a Buy rating. They cited the challenging start to the year and conservative guidance for fiscal year 2025 as reasons for the revision. The company has provided a cautious outlook for 2025, projecting same-restaurant sales between -2.0% and 1.0%, influenced by macroeconomic factors affecting consumer sentiment.
Additionally, Denny’s Corporation announced the retirement of Brenda Lauderback, Chair of the Board of Directors, effective May 14, 2025. The company has initiated a search for her successor as part of its succession planning efforts. Investors and stakeholders are closely monitoring these developments, as they could impact Denny’s strategic direction and future performance.
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