Today, Denny’s Corporation (NASDAQ:DENN), a well-known full-service restaurant chain trading at $4.55 and near its 52-week low, disclosed the initiation of a pre-arranged stock trading plan to repurchase a limited number of shares of its common stock. According to InvestingPro data, the stock has declined by 8.3% in the past week, potentially creating an attractive entry point as the company’s Fair Value analysis suggests it may be undervalued. This move is in accordance with the guidelines specified under Rule 10b5-1 of the Securities Exchange Act of 1934 and the company’s policies on stock transactions.
The plan is part of Denny’s stock repurchase authorization, which was previously announced on December 2, 2019. The repurchase of shares will be managed by an independent broker and is set to commence no earlier than March 17, 2025, with an expiration date of April 30, 2025. InvestingPro analysis reveals that management has been consistently buying back shares, with the company currently trading at a P/E ratio of 11.07.
The repurchases will be conducted under the constraints of SEC regulations, including certain price, market volume, and timing conditions outlined in the plan. This strategic decision by Denny’s Corporation is aimed at leveraging its capital allocation in a manner that it believes will benefit shareholders.
The company has not disclosed the exact number of shares it plans to repurchase, nor has it provided details on the financial terms of the plan. However, the repurchase program is expected to be executed in a manner that complies with federal securities laws and regulations.
The information provided in this article is based on a press release statement from Denny’s Corporation, as filed with the Securities and Exchange Commission. The company’s initiative reflects an ongoing effort to manage its capital and potentially enhance shareholder value. As the repurchase plan is subject to market conditions and other factors, the actual number of shares repurchased may vary. For deeper insights into Denny’s financial health and growth prospects, investors can access comprehensive analysis and 11 additional ProTips through InvestingPro’s detailed research reports, which provide expert analysis on over 1,400 US stocks.
In other recent news, Denny’s Corporation reported fourth-quarter financial results that did not meet analyst expectations, with adjusted earnings per share coming in at $0.14, a cent below the consensus estimate. The company’s revenue for the quarter was $114.7 million, missing the anticipated $116 million and slightly decreasing from the previous year’s $115.4 million. Despite these results, Benchmark analysts maintained a Buy rating on Denny’s stock, although they revised their price target from $10 to $8, citing a challenging start to the year and conservative guidance for fiscal year 2025.
Denny’s is actively working on a restructuring plan, which includes the closure of 150 underperforming franchisee-operated restaurants by the end of 2025. The company has already closed 88 restaurants in 2024 while opening 12 new locations under its Keke’s brand. Looking forward, Denny’s has projected domestic system-wide same-restaurant sales to range between -2.0% and 1.0% for 2025, influenced by macroeconomic factors affecting consumer sentiment.
Additionally, Brenda Lauderback, the Chair of the Board of Directors, announced her retirement effective May 14, 2025, marking the beginning of the company’s search for her successor. The board is focused on ensuring a smooth leadership transition as part of its corporate governance practices. Investors and stakeholders are closely monitoring these developments, as they may impact Denny’s strategic decisions in the near future.
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