By Mark Kalinowski
Published on June 13, 2019 at 12:00 AM
Not too long ago, the Dunkin’ concept owned and franchised by Dunkin’ Brands Group (DNKN; Neutral) filed its 700+ page Franchise Disclosure Document (FDD) for 2019. In this report, we cite some of the highlights from that document following our review of it, including our review of it in comparison to last year’s Franchise Disclosure Document. For example, we note that the average cost of goods sold for a Dunkin’ unit in the continental U.S. for the 12 months ended October 31, 2018 was 26.9% of sales (please keep in mind that all Dunkin’ units are franchised). The average labor cost was 27.8% of sales. These figures were up year-over-year by ten basis points and 20 basis points, respectively. Also, the average freestanding Dunkin’ unit in the continental U.S. generated average sales of $1,299,700 (for the 12-month period ending October 27, 2018) for units with a drive-thru, and average sales of $1,032,159 (for the same time period) for units lacking a drive-thru. The year-ago averages from the 2018 FDD were $1,299,922 and $1,041,001, respectively. We maintain our Neutral rating on DNKN and note the following:
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By Mark Kalinowski
Published on June 6, 2019 at 12:00 AM
Earlier today (Thursday, June 6th), we learned that the BlackBox Index of same-store sales for May 2019 increased by +1.1%, with same-store traffic down by -2.1%. The +1.1% showing for May 2019 tied for the 6th-best showing of the last 12 months, and evinces 150 basis points worth of sequential improvement from April 2019’s -0.4% decline.
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By Mark Kalinowski
Published on June 4, 2019 at 12:00 AM
With this report, we update our data-driven Kalinowski Restaurant Industry Index for Q2E to +3.0% (up from +2.5% previously). This increase reflects update to various indices we have made over the last 2-3 weeks, most recently a second intra-quarter bump up to our Kalinowski Family Dining Index. We now look for the Kalinowski Restaurant Industry Index — which aggregates the domestic same-store sales for 48 publicly-traded restaurant concepts, and weights them based on those concepts’ U.S. systemwide sales — to be the best in Q2 2019 since Q4 2015. Our Buy-rated stocks remain Denny’s (DENN), Dine Brands (DIN), Domino’s (DPZ), McDonald’s (MCD), Papa John’s (PZZA), and Yum Brands (YUM). As of this writing we are most confident about our above-consensus Q2E same-store sales forecasts for Denny’s, IHOP (owned by Dine Brands), and McDonald’s U.S.
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