NEW YORK (AP) -- An analyst boosted his rating for the parent company of the Applebee's and IHOP restaurant chains on Wednesday, saying that sales trends appear to be improving at Applebee's.
Mark Kalinowski of Janney Capital Markets raised DineEquity Inc.'s rating to "Buy" from "Neutral." In a client note, the analyst said that revenue at Applebee's locations open at least a year likely came in better than Wall Street expected during the third quarter.
The analyst says Applebee's was probably helped by the business it pulls in during late night hours, a segment that continues to grow quickly.
Revenue at stores open at least a year is a key indicator of a restaurant operator's health because it excludes results from locations recently opened or closed.
Kalinowski also says that Wall Street will likely find DineEquity easier to understand once it closes on the sale of some Applebee's locations. The company's stock price is also appealing, he added.
DineEquity shares closed at $56.53 on Tuesday. Its shares have slipped from a high of $57.40 per share on Sept. 25.
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