Denny’s Stock is Getting COOKED (Down 32%) as Closures Pile Up… Can They Turn it Around?

I’m not gonna lie, before I started writing this article… I was about as surprised as I could be to find out Denny’s was still even open. Seriously. I thought the last time I’d see one was on a family road trip in 2004, when my parents dragged me inside for a “quick bite” that turned into an hour-long existential crisis over cold pancakes and a waitress who looked like she hated us more than we hated the food. Let’s just say, not exactly Chick-fil-A.

So imagine my complete and utter lack of shock when I saw that Denny’s stock crashed 32% since Wednesday, scraping the bottom of its 10-year price range.

So, what went wrong? Well, people just don’t love Denny’s like they used to. The company shut down 88 underperforming restaurants in 2024 alone… because, shocker, running a diner that makes $1.1 million a year in sales (which is pennies for a restaurant chain) isn’t exactly a lucrative franchise model. But unfortunately, 2025 is looking even worse. Management is planning to close another 70 to 90 locations, which is way more than investors were expecting.

PSA: If you own a Denny’s, there’s a decent chance corporate is about to slap a “FOR LEASE” sign on the door while your regulars wander off to IHOP.

On paper, Denny’s Q4 2024 results weren’t a total disaster. Same-store sales for its flagship brand were down less than 1%, which is bad, but not “apocalyptic.” That is… until you remember that number excludes the locations that already went under.

But here’s where it gets uglier… same-store sales in early 2025 are down 5%, and management now expects up to a 2% decline for the year. Investors did not like that, hence the stock totally tanking. 

Can Denny’s turn this around? In theory, sure. They did open 14 new restaurants last year and plan to add 25 to 40 this year, including their smaller Keke’s Breakfast Cafe brand (which, fun fact, actually seems to be doing okay). Management is banking on relocating into better areas, shutting down the worst-performing stores, and remodeling existing ones to make them more appealing.

But if your business strategy is based on closing more locations than you’re opening, you might have a bigger problem than “bad locations.”

Denny’s is in trouble, and it’s not because of “changing population trends” or “macroeconomic factors” (both of which management blamed). People are just choosing not to go to Denny’s… a brutal but simple truth. It’s hard to make money when your brand reminds people of either (A) late-night college mistakes or (B) that one time their parents forced them to eat undercooked eggs on a road trip.

Until they figure out how to drive sales without relying on nostalgia and questionable breakfast specials, Denny’s stock might stay on the menu for Wall Street’s Worst Performers.

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Stocks.News has positions in Denny’s and IHOP mentioned in article.