By Christiana Sciaudone
Investing.com - Folks are eatin’ good in the neighborhood again.
Poor grammar aside, Dine Brands Global (NYSE:DIN) rose 10% on Wednesday after reporting improved sales and traffic at Applebee’s and IHOP locations in the second quarter.
Shares of casual dining peers also rose, including Texas Roadhouse (NASDAQ:TXRH), up 6.1%, Bloomin’ Brands, up 2%, Chuy’s Holdings, up 7%, and Brinker International (NYSE:EAT), up 5.6%.
Shares of Dine Brands are down about 44% in 2020. The stock has three buy ratings, one hold and no sells.
Covid-related lockdowns across the country in the spring forced Americans to stay at home or order in. With the lifting of those restrictions, people flocked back to their neighborhood haunts.
Comparable same-restaurant sales at Applebee's improved 11 out of 13 weeks through the week ended June 28. IHOP’s comparable same-restaurant sales improved sequentially for 12 consecutive weeks out of 13 in the same period. About 95% of the 3,154 domestic locations were open for dine-in or take-out and delivery as of June 30.
“Throughout the second quarter, weekly comparable sales and traffic at both Applebee’s and IHOP improved as state and local governments began to ease restrictions on dining room operations. This, coupled with the significant growth of our brands’ off-premise business, contributed to the progress made during the quarter,” said Steve Joyce, chief executive officer of Dine Brands Global.
Off-premise sales at both brands increased significantly. At Applebee’s, off-premise sales accounted for 60.5% of the sales mix for the second quarter, compared to 16.3% for the first quarter of 2020 and 13% for the fourth quarter of 2019. IHOP’s off-premise sales accounted for 53.6% of sales, compared to 12.8% for the first quarter of 2020 and 10.1% for the fourth quarter.