DIN: Updating our EPS and Same-Store Sales Forecasts
With this report, we increase our Q1E U.S. same-store sales forecast for Applebee’s by +450 basis points, to +1.0%. As of this writing, sell-side consensus (according to Consensus Metrix) is at -3.5%. Our increased forecast represents factors including: (1) general improvement in one-year and two-year casual dining sector trends, (2) Applebee’s resumption of national advertising in early March (which it did not have in January and February), coupled with (3) our belief that the Applebee’s guest in general may be more motivated to act by national advertising than the casual-dining guest in general. Keep in mind that about 48% of Applebee’s guests are under the age of 35, and also Applebee’s relative shift embracing more marketing on social-media platforms — to which guests 35 and under seem to respond relatively better than folks above the age of 35.