DineEquity (DIN)

The stock is way ahead of itself. At the core of the turnaround plan is re-franchising corporately owned/operated Applebee’s. While the outlook for the credit markets is uncertain, the restaurant franchise finance market has shut down. GE Capital, the primary lender to restaurant franchisees, has all but stopped lending to the industry by increasing interest rates beyond acceptable levels. Other major players, Merrill and BofA, have discontinued lending money to the industry. Due to the loan size and franchisee net worth requirements, the SBA is not an option. There are no lenders with enough industry knowledge to finance the acquisition of stores.

Julia Stewart is the darling of the industry and is probably the reason why people by the stock. She was in charge of operations at Applebee's when the Applebee's brand was growing strong and worked her magic as CEO of IHOP when the IHOP system desperately needed to elevate the consistency of operations (quality service cleanliness).

Applebee's has hit a ceiling as far as the ability to open new units that will generate above average sales and the casual dining segment has way too much capacity. Applebee's franchisees are strong, professional restaurant management companies that will resist any initiatives that do not provide a good return on investment.

IHOP has driven out franchisees with poor operations, raised the bar for the overall system, and strengthened the brands awareness through advertising. The low hanging fruit has been picked and sales/profit growth will happen slowly over multiple years.

I believe management’s hands are tied for the next twelve months or so and won’t be able to engineer the earnings improvement.

Garbage stock and garbage company. Applebee's has been deteriorating for years and will continue to.

ok...total debt is ridiculous.short term debt is extremely manageable though. I like IHOP actually as far as food goes.

While there are many good issues involving the Applebee's purchase and restructuring of the (now) subsidiary into a mostly 'franchise' paradigm, (AND I like the management decisions of the last year plus...) there is still a good deal of pain that the market over-all is going to suffer and I believe that DIN is going to suffer it by association before a real recovery comes across. IF the Obamanation that we are becoming doesn't pull some REAL ideas out the hat and show some REAL results for the money being promised (can you say double digit unemployment AND inflation???) we are in for a bit more 'pain' before someone slaps us out of all this fooliSh (with a small F/big S for SPENDING)-ness.

Bear Market Rally is over. As unemployment continues to increase, $10 dinners will be harder to justify...

Why does this have a P/E of 28? Whether they survive or not is immaterial... this sector has far too much competition to justify that kind of a price.

Profit Margin (-8.5%); ROE (-39%); EPS $ (-9); Debt / Equity 55 %(now thats scary). Let me put it another way-- Market Cap = $528 Mil. & $2.25 BILLION in Debt. with Less than $100 Mil in Cash.

Overweight and too pricey, just like how I feel when I leave their restaurants. I believe they'll survive, but not at this price.

I've made some extra cash by buying put options on this one just after every time it goes up. There are a lot of negative numbers when you click on the "stats" tab. Come on... IHOP, Applebee's ??? What's keeping this stock afloat.

too much debt

The only thing that could have possibly sent this stock climbing like it has is a combination of a short squeeze (which with a float of less than 18 million shares isn't that difficult), people buying beaten down stocks for a trade, and then momentum investors getting involved once they saw the price exploding. There is no fundamental reason for the price rise and its not like casual dining has a tailwind in its favor right now. I'm going to predict that DIN will be back below $10 a share before the end of the year and that within 5 years the company will have changed ownership structure in some shape or form.

How this stock got on a list of companies that may go belly up in the next two years is beyond me. The margins for eggs alone is like 40%! Lazy people are always going to be lazy and let others feed their fat faces for them.

What can i say "COME HUNGRY LEAVE HAPPY " & " CARSIDE TOGO "

Prepare for death by crushing (debt). Just as a side note, the food looks disgusting in the commercials. Not that it's much better in person.

DIN has one of the most illiquid balance sheet. It is also loss making.

too much leverage and it must come down. I suspect they will raise capital via an equity offering

great stock

worst 30days caps

DIN - big bargain?

Wait: a nationwide restaurant chain with lots of name recoginition, down more than 3/4? I smell big bargain! NOT!

A look at the obvious numbers tells. Quick ratio is 0.5, the debt to equity ration is 37 (for comparison, JBX is 1). Appleby division is losing money, and has same store sales DOWN (yuck; dude, when did you last wash the dishes and take out the garbage?).

I looked under the hood: EWWW! Rotten meat!! I THINK I AM GOING TO BE SICK!

It sure looks like a train wreck in slow motion headed for chapter 11.

IHOP bought Appleby's for $2B in debt, and got 1500 franchises and 500 company run stores. Their strategy: sell off the company stores, and use those $$$ to pay off the debt. Nice idea.

Problem: numbers do not add up. 10Q note #4 says equipment, good will, and property equals $1.5B; divided amongst 500 company stores, this goes to about #3M per store. Problem: note #12 states that they sold 40 stores for $4M.

Wait: something here is not right. You mean to tell me that you can BUY an Appleby's, lock, stock and barrel for $1M, including land and building???

So, at that rate, DIN will convert their company stores to franchises, and realize only $0.5B? So, they bought the rights to 2K franchises for $1.5B? Good buy perhaps, but DIN has no way to finance that large of a debt load.