By Mark Kalinowski
Published on October 29, 2020 at 12:00 AM
Earlier today, Dunkin’ Brands Group (DNKN; Neutral, $100.73) reported adjusted Q3 EPS of $0.93, ahead of our $0.81 forecast and sell-side consensus (according to Consensus Metrix) of $0.80. Helping to drive the beat were: (1) Occupancy Expenses for Franchised Restaurants/Franchise Fees and Royalty Income (5.2% actual vs. our 6.1% estimate), and (2) Depreciation & Other/Total Revenues (1.4% actual vs. our 1.6% estimate). The 24.2% adjusted tax rate was also more favorable than our 26.2% estimate, helping Q3 adjusted EPS by about +2 cents.
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By Mark Kalinowski
Published on October 28, 2020 at 12:00 AM
Earlier today, Dine Brands — parent company of the Applebee’s and IHOP restaurant concepts — reported adjusted Q3 EPS of $0.80, coming in well ahead of our $0.22 forecast and sell-side consensus (according to Consensus Metrix) of $0.37. A lowerthan-expected Q3 tax rate helped EPS by roughly +20 cents; we look for the tax rate to be at (or near) 26% in 2021E, but for Q4E we now project a tax rate of 41%. (Management does not quantify what to expect for the Q4 2020 tax rate, but does say to “expect it to be significantly higher than the normal statutory rate… a very high effective tax rate. It is possible that even our updated 41.0% forecast might be too low.)
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By Mark Kalinowski
Published on October 27, 2020 at 12:00 AM
After Tuesday’s market close, Denny’s reported adjusted Q3 EPS of +$0.01, which was ahead of our -$0.03 forecast and sell-side consensus (according to Consensus Metrix) of -$0.03. We attribute the Q3 EPS beat largely to higher-than-anticipated company-owned restaurant margins (1.7% actual — or roughly -3% to -4% excluding an approximate “$1.5 million of favorable reserve adjustments and tax credits related to the CARES Act”) vs. our forecast (-6.5% projected). This more than offset higherthan-anticipated G&A/Revenues (19.1% actual vs. our 17.5% estimate) and D&A/ Revenues (5.7% actual vs. 5.3% estimate).
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