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Dine Brands' (DIN) Q4 Earnings Top, Revenues Miss Estimates

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Dine Brands Global, Inc. (DIN - Free Report) reported mixed fourth-quarter fiscal 2021 results, with earnings surpassing the Zacks Consensus Estimate and revenues missing the same. However, the metrics increased year over year. Following the results, the company’s shares declined 9.2% on Mar 2.

Adjusted earnings were $1.32 per share, beating the consensus estimate of $1.28. In the prior-year quarter, the company reported earnings per share (EPS) of 39 cents. The bottom line during the quarter was driven by higher gross profit.

Total revenues in the reported quarter amounted to $229.6 million, up 17.1% on a year-over-year basis. However, the top line lagged the consensus estimate of $235 million. Robust royalties, franchise fees and other and advertising revenues aided the company’s top line.

Brand Performances by Comps

Applebee's domestic system-wide comps rallied 34.8%. IHOP’s domestic system-wide comps were up 39.2%.

DINE BRANDS GLOBAL, INC. Price, Consensus and EPS Surprise

 

DINE BRANDS GLOBAL, INC. Price, Consensus and EPS Surprise

DINE BRANDS GLOBAL, INC. price-consensus-eps-surprise-chart | DINE BRANDS GLOBAL, INC. Quote

 

Costs & Gross Profits

In the fourth quarter, the total cost of revenues increased 3.5% year over year to $133.2 million. Gross profits were $96.5 million, up 43.2% from the year-ago quarter’s levels.

General and administrative expenses in the quarter increased 24.1% year over year to $48.9 million.

Balance Sheet

As of Dec 31, 2021, cash and cash equivalents amounted to $361.4 million compared with $383.4 million as of Dec 31, 2020. Long-term debt at the end of fourth-quarter 2021 totaled $1,279.6 million compared with $1,492 million at the end of 2020. Goodwill as of Dec 31, 2021, was $251.6 million.

Cash flow from operating activities totaled $195.8 million as of Dec 31, 2021, compared with $96.5 million as of Dec 31, 2020.

2022 View

The company’s guidance assumes that there is not much impact of the coronavirus pandemic, except the Omicron variant in the first quarter.  

The company anticipates general and administrative expenses for 2022 in the range of $188-$198 million. The company expects capital expenditures in the range of $33-$38 million.

Domestic development activity by IHOP franchisees as well as area licensees is anticipated to result in net new openings in the range of 50-65 restaurants. For 2022, the company anticipates adjusted EBITDA in the band of $235-$250 million.

Zacks Rank & Key Picks

The company currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the Zacks Retail-Wholesale sector include Genesco Inc. (GCO - Free Report) ), Arcos Dorados Holdings Inc. (ARCO - Free Report) and Tapestry, Inc. (TPR - Free Report) .

Genesco sports a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 2,739.6%, on average. Shares of the company have gained 41.6% in the past year.

The Zacks Consensus Estimate for Genesco’s 2022 sales and EPS suggests growth of 35.3% and 673.7%, respectively, from the year-ago period’s levels.

Arcos Dorados carries a Zacks Rank #2 (Buy). ARCO has a long-term earnings growth of 24.7%. Shares of the company have surged 53.2% in the past year.

The Zacks Consensus Estimate for Arcos Dorados’ 2022 sales and EPS suggests growth of 35% and 120.8%, respectively, from the year-ago period’s levels.

Tapestry carries a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 28.2%, on average. Shares of the company have increased 2.7% in the past year.

The Zacks Consensus Estimate for Tapestry’s 2022 sales and EPS suggests growth of 17.6% and 22.9%, respectively, from the year-ago period’s levels.