Shares of Denny’s (DENN, Financial) experienced a notable 5.59% rise following a recent upgrade by a Citi analyst from Neutral to Buy. The upgrade is driven by factors such as accelerated store closures, improved cost discipline, and clearer growth plans for KeKe's.
As of the latest data, Denny's (DENN, Financial) stock price is $6.61. Despite the recent uptick, the company's shares are still close to their three-year low. This provides an attractive opportunity for investors who believe in the company's turnaround strategy. It's important to note the stock has seen a marked overall decline with a year-to-date decrease of 40.9% and a five-year decline of 21.4%.
In terms of valuation, Denny's currently holds a price-to-earnings (P/E) ratio of 20.03 and a price-to-sales (P/S) ratio close to its three-year low at 0.79. The company's GF Value is estimated at $12.47, indicating potential undervaluation. For more information on the GF Value, visit the GF Value page. However, it is labeled as a "Possible Value Trap," suggesting caution.
Financially, Denny's exhibits some weaknesses with a "poor" financial strength rating, a concerning Altman Z-score of 1.49, and a low interest coverage ratio of 2.3. These metrics imply a potential risk of financial distress and limited ability to cover interest payments, primarily due to a high debt burden. Despite these challenges, the company's operating margin is expanding, which is typically a positive sign of improving profitability.
With a market capitalization of $339.58 million, Denny's is part of the Consumer Cyclical sector, specifically within the Restaurants industry. Investors should consider both the opportunities presented by recent strategic initiatives and the ongoing financial challenges when evaluating the potential of Denny's (DENN, Financial) stock.
