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Dine Brands Global is Back on the Table

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Dine Brands Global (DIN) is the restaurant company better known for its dine-in restaurant brands, IHOP and Applebee’s. The COVID-19 pandemic hit DIN stock particularly hard, sending shares down over 82% in a matter of weeks during the 2020 coronavirus crash.

Undoubtedly, it was one of the most painful crashes on which to be the receiving end. Yet shares of the beloved restaurant play eventually staged a full recovery, just over a year later. It’s remarkable for any stock to recover after such a devastating implosion. The recovery just goes to show the power of truly robust brands. (See Dine Brands Global stock charts on TipRanks)

While DIN stock failed to break through the psychological ceiling of resistance just shy of the $100 mark, I think the name represents one of the better plays for those looking for the reopening trade to heat up again. Shares are stuck in a downtrend, now off around 20% from their 52-week highs, thanks in part to delta-driven outbreaks. I am bullish on DIN stock amid its latest dip, not just for a reopening trade, but as a long-term investment.

COVID-19 Risks Overblown for Top Reopening Trades?

Delta cases are rising rapidly and they could further pressure the restaurant plays, especially those so heavily reliant on dining in.

Still, it’s important to remember that the Delta wave could peak at any time. Once it does, reopening plays like Dine Brands will have a chance to get back on their feet. And just like that, the reopening trade could be back on, perhaps at the expense of high-multiple tech and cyclicals.

At writing, shares of Dine Brands trade at 1.6 times sales and 21.4 times trailing earnings. On the surface, shares don’t seem to be a bargain. Still, given the potential sales and earnings expansion that could be on the horizon, DIN stock could prove to be cheap here.

Wall Street’s Take

According to TipRanks’ consensus analyst rating, DIN stock comes in as a Strong Buy. Out of 5 analyst ratings, there are 5 unanimous Buy recommendations.

As for price targets, the average analyst price target is $106.20, implying a 34.8% upside. Analyst price targets range from a low of $93.00 per share to a high of $118.00 per share.

Biden’s COVID-19 Plan a Potential Catalyst

Joe Biden’s latest plan to fight COVID-19 could give reopening plays a much-needed jolt, potentially marking the beginning of the end of the immense pain felt by businesses most impacted by COVID-19 restrictions.

Biden has often stated that we’ve entered a “pandemic of the unvaccinated.” As he brings forth measures to finish America’s fight against COVID-19, the horizon may brighten for Dine Brands. The same goes for other dine-in-focused restaurants that can’t afford to keep shutting down their dining rooms every few months.

Biden’s new COVID-19 plan might be met with much protest. Yet while it won’t be easy, one has to think that other nations could follow suit by making a more aggressive push to end the global pandemic.

In any case, IHOP and Applebee’s aren’t going anywhere. They will live to see better days. The faster this pandemic ends, the faster shares will be able to breakout to new highs. As Biden goes after the unvaccinated and Delta peaks, look for DIN stock to finally break out of its funk and put the $100 level to the test again.

Disclosure: At the time of publication, Joey Frenette did not have a position in any of the securities mentioned in this article.

Disclaimer: The information contained in this article represents the views and opinion of the writer only, and not the views or opinion of Tipranks or its affiliates, and should be considered for informational purposes only. Tipranks makes no warranties about the completeness, accuracy or reliability of such information. Nothing in this article should be taken as a recommendation or solicitation to purchase or sell securities. Nothing in the article constitutes legal, professional, investment and/or financial advice and/or takes into account the specific needs and/or requirements of an individual, nor does any information in the article constitute a comprehensive or complete statement of the matters or subject discussed therein. Tipranks and its affiliates disclaim all liability or responsibility with respect to the content of the article, and any action taken upon the information in the article is at your own and sole risk. The link to this article does not constitute an endorsement or recommendation by Tipranks or its affiliates. Past performance is not indicative of future results, prices or performance.

The post Dine Brands Global is Back on the Table appeared first on TipRanks Financial Blog.

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